UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~June 30, ~~2021~~2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-35898

LINDBLAD EXPEDITIONS HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware

27-4749725

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

96 Morton Street, 9th Floor, New York, New York, 10014

(Address of principal executive offices) (Zip Code)

(212) 261-9000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Common Stock, par value $0.0001 per share	LIND	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

~~Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:~~ As of ~~October~~July 25, ~~2021, 50,200,173~~2022, 53,064,376 shares of common stock, par value $0.0001 per share, were ~~issued and~~ outstanding.

LINDBLAD EXPEDITIONS HOLDINGS, INC.

Quarterly Report On Form 10-Q

For The Quarter Ended ~~September~~June 30, ~~2021~~2022

Table of Contents

		Page(s)

PART I. FINANCIAL INFORMATION

ITEM 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets as of ~~September~~June 30, ~~2021~~2022 (Unaudited) and December 31, ~~2020~~2021	1
	Condensed Consolidated Statements of Operations for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	2
	Condensed Consolidated Statements of Comprehensive Loss for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	3
	Condensed Consolidated Statements of Stockholders’ (Deficit) Equity for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	4
	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	6
	Notes to the Condensed Consolidated Financial Statements (Unaudited)	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2320
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	3732
ITEM 4.	Controls and Procedures	3733

PART II. OTHER INFORMATION

ITEM 1.	Legal Proceedings	3833
ITEM 1A.	Risk Factors	3833
ITEM 2.	Unregistered Sale of Equity Securities and Use of Proceeds	3833
ITEM 3.	Defaults Upon Senior Securities	3934
ITEM 4.	Mine Safety Disclosures	3934
ITEM 5.	Other Information	3934
ITEM 6.	Exhibits	4035

SIGNATURES		4136

PART 1.	FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS

LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

	*As of September 30, 2021*			*As of December 31, 2020*			*June 30, 2022*			*December 31, 2021*
	(unaudited)							(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	155,562		$	187,531		$	126,904		$	150,753
Restricted cash		29,474			16,984			48,831			21,940
Marine operating supplies		5,894			5,473			9,892			8,275
Inventories		2,122			2,168			2,337			2,278
Prepaid expenses and other current assets		27,078			17,014			45,936			27,094
Total current assets		220,130			229,170			233,900			210,340

Property and equipment, net		547,771			482,673			544,746			542,418
Goodwill		32,772			22,105			42,017			42,017
Intangibles, net		10,165			4,817			12,123			13,235
Deferred tax asset		8,188			5,539			8,736			7,609
Right-to-use lease assets		4,230			5,082			3,764			4,402
Other long-term assets		7,374			8,063			4,020			7,470
Total assets	$	830,630		$	757,449		$	849,306		$	827,491

LIABILITIES
Current Liabilities:
Unearned passenger revenues	$	189,641		$	120,737		$	270,985		$	212,598
Accounts payable and accrued expenses		48,317			22,341			61,224			49,252
Lease liabilities - current		1,418			1,475			1,556			1,553
Long-term debt - current		20,260			11,255			24,081			26,061
Total current liabilities		259,636			155,808			357,846			289,464

Long-term debt, less current portion		526,857			471,359			539,872			518,658
Lease liabilities		3,124			3,915			2,517			3,178
Other long-term liabilities		95			90			302			247
Total liabilities		789,712			631,172			900,537			811,547

COMMITMENTS AND CONTINGENCIES
Series A redeemable convertible preferred stock, 165,000 shares authorized; 85,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively		87,785			83,825
Redeemable noncontrolling interest		10,134			7,494
Commitments and contingencies								-			-
Series A redeemable convertible preferred stock, 165,000 shares authorized; 62,000 and 80,000 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively								67,052			83,901
Redeemable noncontrolling interests								19,595			10,626
		97,919			91,319			86,647			94,527

STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value, 1,000,000 shares authorized; 85,000 Series A shares issued and outstanding as of September 30, 2021 and December 31, 2020		0			0
Common stock, $0.0001 par value, 200,000,000 shares authorized; 50,191,647 and 49,905,512 issued, 50,146,407 and 49,818,676 outstanding as of September 30, 2021 and December 31, 2020, respectively		5			5
STOCKHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value, 1,000,000 shares authorized; 62,000 and 80,000 Series A shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively								0			0
Common stock, $0.0001 par value, 200,000,000 shares authorized; 53,064,077 and 50,800,786 issued, 53,018,837 and 50,755,546 outstanding as of June 30, 2022 and December 31, 2021, respectively								5			5
Additional paid-in capital		52,146			48,127			80,812			58,485
Accumulated deficit		(108,411	)		(11,572	)		(218,695	)		(136,439	)
Accumulated other comprehensive loss		(741	)		(1,602	)		0			(634	)
Total stockholders' (deficit) / equity		(57,001	)		34,958
Total liabilities, mezzanine equity and stockholders' equity	$	830,630		$	757,449
Total stockholders' deficit								(137,878	)		(78,583	)
Total liabilities, mezzanine equity and stockholders' deficit							$	849,306		$	827,491

The accompanying notes are an integral part of these condensed consolidated financial statements.

LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data)

(unaudited)

	*For the three months ended September 30,*						*For the nine months ended September 30,*						*For the three months ended June 30,*						*For the six months ended June 30,*
	*2021*			*2020*			*2021*			*2020*			*2022*			*2021*			*2022*			*2021*

Tour revenues	$	64,507		$	1,019		$	81,555		$	81,991		$	90,910		$	15,266		$	158,756		$	17,047

Operating expenses:
Cost of tours		45,600			8,075			73,270			62,988			62,499			19,391			120,447			27,670
General and administrative		17,023			9,145			46,123			36,170			23,710			15,288			44,347			29,100
Selling and marketing		10,213			2,128			17,680			18,413			12,839			4,962			25,168			7,467
Depreciation and amortization		9,323			8,485			25,785			23,728			11,176			8,213			22,354			16,462
Total operating expenses		82,159			27,833			162,858			141,299			110,224			47,854			212,316			80,699

Operating loss		(17,652	)		(26,814	)		(81,303	)		(59,308	)		(19,314	)		(32,588	)		(53,560	)		(63,652	)

Other (expense) income:
Interest expense, net		(6,063	)		(4,529	)		(17,436	)		(11,763	)		(9,416	)		(5,705	)		(18,130	)		(11,374	)
(Loss) gain on foreign currency		(1,434	)		989			(1,165	)		(6,334	)		(676	)		199			(546	)		269
Other income (expense)		4,357			(74	)		4,362			(188	)
Other (expense) income														(116	)		2			417			4
Total other expense		(3,140	)		(3,614	)		(14,239	)		(18,285	)		(10,208	)		(5,504	)		(18,259	)		(11,101	)

Loss before income taxes		(20,792	)		(30,428	)		(95,542	)		(77,593	)		(29,522	)		(38,092	)		(71,819	)		(74,753	)
Income tax expense (benefit)		2,507			(2,893	)		(2,648	)		(7,664	)
Income tax benefit														(964	)		(2,357	)		(1,113	)		(5,158	)

Net loss		(23,299	)		(27,535	)		(92,894	)		(69,929	)		(28,558	)		(35,735	)		(70,706	)		(69,595	)
Net income (loss) attributable to noncontrolling interest		1,039			(156	)		(17	)		(956	)		198			(437	)		(229	)		(1,056	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		(24,338	)		(27,379	)		(92,877	)		(68,973	)		(28,756	)		(35,298	)		(70,477	)		(68,539	)
Series A redeemable convertible preferred stock dividend		1,340			425			3,962			425			1,283			1,318			2,581			2,622

Net loss available to stockholders	$	(25,678	)	$	(27,804	)	$	(96,839	)	$	(69,398	)	$	(30,039	)	$	(36,616	)	$	(73,058	)	$	(71,161	)

Weighted average shares outstanding
Basic		50,110,188			49,779,525			50,013,191			49,715,663			51,195,280			50,064,152			50,976,203			49,964,693
Diluted		50,110,188			49,779,525			50,013,191			49,715,663			51,195,280			50,064,152			50,976,203			49,964,693

Undistributed loss per share available to stockholders:
Basic	$	(0.50	)	$	(0.56	)	$	(1.87	)	$	(1.40	)	$	(0.59	)	$	(0.71	)	$	(1.43	)	$	(1.38	)
Diluted	$	(0.50	)	$	(0.56	)	$	(1.87	)	$	(1.40	)	$	(0.59	)	$	(0.71	)	$	(1.43	)	$	(1.38	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

	*Common Stock*				*Additional Paid-In*			*Accumulated*			*Accumulated Other Comprehensive*			*Total Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*Loss*			*Deficit*
Balance as of March 31, 2022		50,933,471	$	5	$	60,307		$	(183,717	)	$	0		$	(123,405	)
Stock-based compensation		-		0		1,823			0			0			1,823
Net activity related to equity compensation plans		21,045		0		(747	)		0			0			(747	)
Issuance of stock for conversion of preferred stock		2,109,561		0		19,429			0			0			19,429
Redeemable noncontrolling interest		-		0		0			(4,939	)		0			(4,939	)
Series A preferred stock dividend		-		-		-			(1,283	)		-			(1,283	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-		0		0			(28,756	)		0			(28,756	)
Balance as of June 30, 2022		53,064,077	$	5	$	80,812		$	(218,695	)	$	0		$	(137,878	)

	*Common Stock*				*Additional Paid-In*			*Accumulated*			*Accumulated Other Comprehensive*			*Total Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*Loss*			*Deficit*
Balance as of December 31, 2021		50,800,786	$	5	$	58,485		$	(136,439	)	$	(634	)	$	(78,583	)
Stock-based compensation		-		0		3,651			0			0			3,651
Net activity related to equity compensation plans		153,730		0		(753	)		0			0			(753	)
Issuance of stock for conversion of preferred stock		2,109,561		0		19,429			0			0			19,429
Other comprehensive income, net		-		0		0			0			634			634
Redeemable noncontrolling interest		-		0		0			(9,198	)		0			(9,198	)
Series A preferred stock dividend		-		0		0			(2,581	)		0			(2,581	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-		0		0			(70,477	)		0			(70,477	)
Balance as of June 30, 2022		53,064,077	$	5	$	80,812		$	(218,695	)	$	0		$	(137,878	)

Condensed Consolidated Statements of Stockholders’ (Deficit) Equity (continued)

	*Common Stock*				*Additional Paid-In*			*Accumulated*			*Accumulated Other*			*Total Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*Comprehensive Loss*			*Equity (Deficit)*
Balance as of March 31, 2021		50,126,926	$	5	$	51,367		$	(46,117	)	$	(1,108	)	$	4,147
Stock-based compensation		-		0		1,129			0			0			1,129
Net activity related to equity compensation plans		12,905		0		(1,719	)		0			0			(1,719	)
Other comprehensive income, net		-		0		0			0			165			165
Series A preferred shares dividend		-		-		-			(1,318	)		-			(1,318	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-		0		0			(35,298	)		0			(35,298	)
Balance as of June 30, 2021		50,139,831	$	5	$	50,777		$	(82,733	)	$	(943	)	$	(32,894	)

	*Common Stock*				*Additional Paid-In*			*Accumulated*			*Accumulated Other*			*Total Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*Comprehensive Loss*			*Equity (Deficit)*
Balance as of December 31, 2020		49,905,512	$	5	$	48,127		$	(11,572	)		(1,602	)	$	34,958
Stock-based compensation		-		0		2,606			0			0			2,606
Net activity related to equity compensation plans		152,017		0		(1,726	)		0			0			(1,726	)
Issuance of stock for acquisition		82,302		0		1,770			0			0			1,770
Other comprehensive income, net		-		0		0			0			659			659
Series A preferred shares dividend		-		0		0			(2,622	)		0			(2,622	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-		0		0			(68,539	)		0			(68,539	)
Balance as of June 30, 2021		50,139,831	$	5	$	50,777		$	(82,733	)	$	(943	)	$	(32,894	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

	*For the six months ended June 30,*
	*2022*			*2021*
Cash Flows From Operating Activities
Net loss	$	(70,706	)	$	(69,595	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		22,354			16,462
Amortization of deferred financing costs and other, net		1,313			1,525
Amortization of right-to-use lease assets		(20	)		2
Stock-based compensation		3,651			2,740
Deferred income taxes		(1,128	)		(5,158	)
Change in fair value of contingent acquisition consideration		56			0
Loss (gain) on foreign currency		546			(269	)
Write-off of unamortized issuance costs related to debt refinancing		9,004			0
Changes in operating assets and liabilities
Marine operating supplies and inventories		(1,676	)		(819	)
Prepaid expenses and other current assets		(19,388	)		(9,643	)
Unearned passenger revenues		58,387			76,747
Other long-term assets		3,431			862
Other long-term liabilities		845			3,336
Accounts payable and accrued expenses		11,971			5,648
Net cash provided by operating activities		18,640			21,838

Cash Flows From Investing Activities
Purchases of property and equipment		(23,550	)		(25,239	)
Acquisition (net of cash acquired)		0			(7,177	)
Net cash used in investing activities		(23,550	)		(32,416	)

Cash Flows From Financing Activities
Proceeds from long-term debt		360,000			15,484
Repayments of long-term debt		(340,491	)		(1,014	)
Payment of deferred financing costs		(10,804	)		(3,135	)
Repurchase under stock-based compensation plans and related tax impacts		(753	)		(1,726	)
Net cash provided by financing activities		7,952			9,609
Net increase (decrease) in cash, cash equivalents and restricted cash		3,042			(969	)
Cash, cash equivalents and restricted cash at beginning of period		172,693			204,515

Cash, cash equivalents and restricted cash at end of period	$	175,735		$	203,546

Supplemental disclosures of cash flow information:
Cash paid during the period:
Interest	$	6,204		$	8,571
Income taxes		124			1
Non-cash investing and financing activities:
Non-cash preferred stock dividend	$	2,581		$	2,622
Value of shares issued for acquisition		0			1,770

The accompanying notes are an integral part of these condensed consolidated financial statements.

Common Stock

Additional Paid-In

Accumulated

Accumulated Other Comprehensive

Total Stockholders'

Shares

Amount

Capital

Deficit

Loss

Equity

Balance as of June 30, 2021
50,139,831 $ 5 $ 50,777 $ (82,733 ) $ (943 ) $ (32,894 )
Stock-based compensation
- 0 1,406 0 0 1,406
Issuance of stock for equity compensation plans, net
51,816 0 (37 ) 0 0 (37 )
Other comprehensive income, net
- 0 0 0 202 202
Series A preferred stock dividend
- 0 0 (1,340 ) 0 (1,340 )
Net loss attributable to Lindblad Expeditions Holdings, Inc
- 0 0 (24,338 ) 0 (24,338 )
Balance as of September 30, 2021
50,191,647 $ 5 $ 52,146 $ (108,411 ) $ (741 ) $ (57,001 )

Common Stock

Additional Paid-In

Accumulated

Accumulated Other Comprehensive

Total Stockholders'

Shares

Amount

Capital

Deficit

Loss

Equity

Balance as of January 1, 2021
49,905,512 $ 5 $ 48,127 $ (11,572 ) $ (1,602 ) $ 34,958
Stock-based compensation
- 0 4,012 0 0 4,012
Issuance of stock for equity compensation plans, net
203,833 0 (1,763 ) 0 0 (1,763 )
Issuance of stock for acquisition
82,302 0 1,770 0 0 1,770
Other comprehensive income, net
- 0 0 0 861 861
Series A preferred stock dividend
- 0 0 (3,962 ) 0 (3,962 )
Net loss attributable to Lindblad Expeditions Holdings, Inc.
- 0 0 (92,877 ) 0 (92,877 )
Balance as of September 30, 2021
50,191,647 $ 5 $ 52,146 $ (108,411 ) $ (741 ) $ (57,001 )

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

~~Condensed Consolidated Statements of Stockholders~~’ ~~Equity (continued)~~

Common Stock

Additional Paid-In

Retained

Accumulated Other Comprehensive

Total Stockholders'

Shares

Amount

Capital

Earnings

Loss

Equity

Balance as of June 30, 2020
49,822,955 $ 5 $ 47,394 $ 45,403 $ (8,824 ) $ 83,978
Stock-based compensation
- 0 310 0 0 310
Issuance of stock for equity compensation plans, net
52,231 0 (42 ) 0 0 (42 )
Other comprehensive income, net
- 0 0 0 1,745 1,745
Redeemable noncontrolling interest
- 0 0 1,874 0 1,874
Series A preferred shares dividend
0 0 (425 ) 0 (425 )
Net loss attributable to Lindblad Expeditions Holdings, Inc.
- 0 0 (27,379 ) 0 (27,379 )
Balance as of September 30, 2020
49,875,186 $ 5 $ 47,662 $ 19,473 $ (7,079 ) $ 60,061

Common Stock

Additional Paid-In

Retained

Accumulated Other Comprehensive

Total Stockholders'

Shares

Amount

Capital

Earnings

Loss

Equity

Balance as of January 1, 2020
49,717,522 $ 5 $ 46,271 $ 81,655 (4,681 ) $ 123,250
Stock-based compensation
- 0 1,911 0 0 1,911
Issuance of stock for equity compensation plans, net
166,181 0 (393 ) 0 0 (393 )
Repurchase of shares and warrants
(8,517 ) 0 (127 ) 0 0 (127 )
Other comprehensive loss, net
- 0 0 0 (2,398 ) (2,398 )
Redeemable noncontrolling interest
- 0 0 7,216 0 7,216
Series A preferred shares dividend
0 0 (425 ) 0 (425 )
Net loss attributable to Lindblad Expeditions Holdings, Inc.
- 0 0 (68,973 ) 0 (68,973 )
Balance as of September 30, 2020
49,875,186 $ 5 $ 47,662 $ 19,473 $ (7,079 ) $ 60,061

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

For the nine months ended September 30,

2021

2020

Cash Flows From Operating Activities

Net loss
$ (92,894 ) $ (69,929 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization
25,785 23,728
Amortization of National Geographic fee
0 727
Amortization of deferred financing costs and other, net
2,364 1,549
Amortization of right-to-use lease assets
4 149
Stock-based compensation
4,146 1,911
Deferred income taxes
(2,648 ) (7,710 )
Loss on foreign currency
1,165 6,334
Changes in operating assets and liabilities

Marine operating supplies and inventories
(375 ) 589
Prepaid expenses and other current assets
(8,902 ) 6,320
Unearned passenger revenues
62,922 (18,362 )
Other long-term assets
658 698
Other long-term liabilities
4,857 (4,949 )
Accounts payable and accrued expenses
24,438 (12,794 )
Net cash provided by (used in) operating activities
21,520 (71,739 )

Cash Flows From Investing Activities

Purchases of property and equipment
(89,114 ) (152,791 )
Acquisition (net of cash acquired)
(7,177 ) 0
Net cash used in investing activities
(96,291 ) (152,791 )

Cash Flows From Financing Activities

Proceeds from long-term debt
61,720 183,339
Repayments of long-term debt
(1,530 ) (1,500 )
Payment of deferred financing costs
(3,135 ) (4,877 )
Repurchase under stock-based compensation plans and related tax impacts
(1,763 ) (393 )
Proceeds from Series A preferred stock issuance
0 85,000
Repurchase of warrants and common stock
0 (127 )
Net cash provided by financing activities
55,292 261,442
Net (decrease) increase in cash, cash equivalents and restricted cash
(19,479 ) 36,912
Cash, cash equivalents and restricted cash at beginning of period
204,515 109,258

Cash, cash equivalents and restricted cash at end of period
$ 185,036 $ 146,170

Supplemental disclosures of cash flow information:

Cash paid during the period:

Interest
$ 13,300 $ 12,418
Income taxes
$ 54 $ 650
Non-cash investing and financing activities:

Non-cash preferred share dividend
$ 3,962 $ 0
Shares issued for acquisition
$ 1,770 $ 0

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

Lindblad Expeditions Holdings, Inc. and its consolidated subsidiaries’ (the “Company” or “Lindblad”) mission is offering life-changing adventures around the world and pioneering innovative ways to allow its guests to connect with exotic and remote places. The Company currently operates a fleet of ten owned expedition ships and five seasonal charter vessels under the Lindblad brand, operates land-based, eco-conscious expeditions and active nature focused tours under the Natural Habitat, Inc. (“Natural Habitat”) and Off the Beaten Path, LLC (“Off the Beaten Path”) brands, designs handcrafted walking tours under the Classic Journeys, LLC (“Classic Journeys”) brand and operates luxury cycling and adventure tours under the DuVine Cycling + Adventure Company (“DuVine”) brand.

Lindblad Segment. The Lindblad segment ~~consists~~ primarily ofprovides ship-based expeditions aboard customized, nimble and intimately-scaled vessels that are able to venture where larger cruise ships cannot, ~~thereby~~thus allowing Lindblad to offer up-close experiences in the planet’s wild and remote places and capitals of culture. ~~Many~~Each expedition ship is fully equipped with state-of-the-art tools for in-depth exploration and the majority of ~~these~~ expeditions involve travel to remote places with limited infrastructure and ports, such as Antarctica and the Arctic, or places that are best accessed by a ship, such as the Galápagos Islands, Alaska, ~~and Baja’s~~Baja California’s Sea of Cortez and Panama, and foster active engagement by guests. ~~Each expedition ship is designed to be comfortable and inviting, while being fully equipped with state-of-the-art tools for in-depth exploration.~~ The Company has an alliance with National Geographic Partners, LLC (“National Geographic”), which provides for lecturers and National Geographic experts, including photographers, writers, marine biologists, naturalists, field researchers and film crews, to join many of the Company’s expeditions.

Land Experiences Segment. The Land Experiences segment includes our ~~three~~four primarily land-based brands, Natural Habitat, DuVine, ~~and~~ Off the Beaten ~~Path.~~Path and Classic Journeys.

The Company’s common stock is listed on the NASDAQ Capital Market under the symbol “LIND”.

The accompanying unaudited condensed consolidated financial statements and footnotes have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding unaudited interim financial information and include the accounts and transactions of the Company. In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial statements for the periods presented. Operating results for the periods presented are not necessarily indicative of the results of operations to be expected for the full year due to seasonality and other factors. Certain information and footnote disclosures normally included in the consolidated financial statements in accordance with ~~U.S.~~ GAAP have been omitted in accordance with the rules and regulations of the SEC for interim reporting. All intercompany balances and transactions have been eliminated in these unaudited condensed consolidated financial statements. These unaudited condensed consolidated financial statements and footnotes should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto for the year ended December 31, ~~2020~~2021 contained in the Company’s Annual Report on Form 10-K filed with the SEC on ~~March 12, 2021~~February 28, 2022 (the “~~2020~~2021 Annual Report”).

There have been no significant changes to the Company’s accounting policies from those disclosed in the ~~2020~~2021 Annual Report.

The Company ~~resumed ship~~continued to ramp its operations induring the ~~June 2021~~ second~~and as~~ quarter of ~~November 2, 2021~~ 2022,~~had~~ ~~eight~~ providing immersive expeditions across all ten of its owned vessels including trips to Alaska, the Arctic, the Galápagos Islands, Iceland, Norway and the Baltic and North Seas. Due to the spread of the COVID-~~ten~~19 ~~vessels providing expeditions to guests. During~~ ~~June 2021,~~ virus and the effects of travel restrictions around the world, the Company ~~launched~~ ~~three~~ ~~ships in Alaska and another in the Galapagos, and during the~~ ~~third~~ ~~quarter the Company resumed operations on~~suspended or rescheduled the majority of its ~~remaining vessels with additional ships operating in Alaska, the Galapagos, Iceland~~expeditions departing between March 16, 2020 through May 31, 2021. Travel restrictions related to COVID-19 have diminished dramatically, and the ~~Pacific Northwest. The~~ Company continues to work with local authorities on plans to operate itineraries in additional geographies ~~such as Antarctica,~~ during the ~~remainder~~second half of ~~the year~~2022 and ~~early~~in ~~2022.~~2023. ~~As the COVID-~~19 ~~virus effects~~Where travel restrictions ~~in various locations around~~remain, which also includes a limited number of itineraries impacted by the ~~world,~~Russia-Ukraine conflict, the Company ~~also continues to work~~is adjusting itineraries where possible, and working with ~~its~~ guests to reschedule travel plans and refund payments or issue future travel certificates, as ~~applicable, for those expeditions and trips that the Company is~~ ~~not~~ ~~able to operate.~~applicable.

The Company believes there are a variety of strategic advantages that enable it to deploy its ships safely and quickly, while mitigating the risk of COVID-19 as travel restrictions are lifted. The most notable is the size of its owned and operated vessels which range from 48 to 148 passengers, allowing for a highly controlled environment that includes stringent cleaning protocols. The small nature of the Company’s ships also allows it to efficiently and effectively test its guests and crew prior to ~~boarding.~~boarding, or as otherwise needed. Additionally, all guests age 12five and older, crew and staff are required to be fully vaccinated and the majority of expeditions take place in remote locations where human interactions are limited, so there is less opportunity for external influence.

~~While the Company’s ships were~~ ~~not~~ in operations, the majority of the fleet was being maintained with minimally required crew on-board to ensure they complied with all necessary regulations and could be fully put back into service quickly as needed. Ahead of launching each ship, crew levels were increased as necessary to prepare each vessel for operations as well as for crew training and vaccinations. The Company’s offices primarily remain closed, and most employees are working remotely to maintain general business operations, to provide assistance to existing and potential guests and to maintain information technology systems.

~~The Company continues to adhere to the comprehensive plan it implemented in~~ ~~March 2020~~ ~~to mitigate the impact of COVID-~~19 and preserve and enhance its liquidity position. Prior to resuming operations, this plan employed a variety of cost reduction and cash preservation measures including significantly reducing ship and land-based expedition costs such as capital expenditures, crew payroll, land costs, fuel and food, and meaningfully reducing general and administrative expenses through reduced payroll and the elimination of all non-essential travel, office expenses and discretionary spending. The Company also accessed available capital under existing debt facilities and through the issuance of preferred stock. With the majority of operations resuming, operating costs are ramping back up, but given the continued uncertainty around COVID-19 ~~and given that guest counts have~~ ~~not~~ ~~yet returned to traditional levels, the Company continues to minimize expenditures as appropriate.~~

As of ~~September~~June 30, ~~2021,~~2022, the Company had ~~$155.6~~$126.9 million in unrestricted cash and ~~$29.5~~$48.8 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves. ~~During~~ ~~August 2021,~~ the Company received a $21.0 million grant under the Coronavirus Economic Relief for Transportation Services (“CERTS”) Act, which provided grants to eligible motorcoach, school bus, passenger vessel, and pilotage companies, see Note 4 ~~— Financial Statement Details for additional information.~~

As of ~~September~~June 30, ~~2021,~~2022, the Company had a total debt position of ~~$561.8~~$578.2 million and was in compliance with all of its debt ~~covenants.~~

~~During~~ ~~September 2021,~~ covenants in effect. The Company estimates that it will be in compliance with all applicable covenants over the ~~Company drew down $46.2 million under its~~next ~~second~~12 ~~export credit agreement in conjunction with its final payment upon delivery of the~~ ~~National Geographic Resolution.~~In ~~April 2021~~ ~~the Company drew down $15.5 million under the~~ ~~second~~ ~~export credit agreement in conjunction with its~~ ~~fourth~~ ~~installment payment for the vessel.~~months.

During ~~June 2021,~~May 2022, the Company further amended its senior secured export credit agreements to ~~among other things, extend the deferral of scheduled amortization payments of the~~ ~~first~~ ~~export credit facility through~~ ~~December 2021~~ ~~in the aggregate amount of $15.7 million,~~ extend the waiver of its ~~total~~ net leverage coverage ratio ~~covenant through~~from March ~~31,~~ 2022 ~~increase the interest rate spreads of the export credit facilities by 50 basis points and annualize EBITDA used in its covenant calculation~~ through December 31, 2022.~~The deferred principal payments will amortize quarterly over~~ ~~three~~ ~~years starting in~~ ~~March 2022.~~ ~~Certain other covenants continue to be more restrictive during the extended covenant waiver period.~~

~~During~~On ~~April 2021,~~February 4, 2022, the Company ~~amended its term loan~~issued $360.0 million of 6.75% senior secured notes, maturing 2027, and entered into a new $45.0 million revolving credit ~~facilities~~facility, including a letter of credit sub-facility in an aggregate principal amount of up to ~~among other things, extend~~$5.0 million. Proceeds from the ~~waiver of its total net leverage ratio covenant through~~ ~~March 31, 2022,~~ ~~annualize EBITDA~~senior secured note issuance were used ~~in its covenant calculation through~~ ~~December 31, 2022~~ ~~and increase~~primarily to pay the ~~interest rate spreads of~~outstanding borrowings under the Company's prior credit agreement, including the term ~~loan, excluding the~~facility, Main Street Loan and the revolving credit ~~facility by an additional 50~~facility. The senior secured notes are guaranteed on a senior secured basis ~~points. Certain other covenants continue to be more restrictive during the extended covenant waiver period.~~

~~Given the dynamic and unpredictable nature of the COVID-~~19 pandemic, the Company cannot reasonably estimate the potential impacts the pandemic will have on its financial condition, results of operations, cash flows, plans and growth for the foreseeable future. It is unknown when full travel restrictions and various remaining border closures will be lifted and what the demand for expedition travel will be once restrictions are no ~~longer in place. Based on the actions taken to date~~ by the Company ~~its planned~~ and ~~anticipated actions and its current forecast, the Company believes that it can meet its obligations for the next~~ 12 ~~months from~~ ~~November 2, 2021,~~ ~~the date~~certain of ~~this Quarterly Report on Form~~ 10~~-Q.~~

In ~~December 2019,~~ ~~the FASB issued ASU~~ ~~2019~~-~~12,~~ ~~Income Taxes (Topic~~ ~~740~~~~)—Simplifying the Accounting for Income Taxes. The amendments of this ASU are intended to simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic~~ ~~740.~~ ~~The amendments also improve consistent application of and simplify GAAP for other areas of Topic~~ ~~740~~ ~~by clarifying and amending existing guidance. This ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after~~ ~~December 15, 2020.~~ ~~The Company adopted this ASU as required, and it has~~ ~~not~~ ~~had, nor is it expected to have, a material impact to~~ the Company’s ~~financial statements.~~

In ~~March 2020,~~ ~~the FASB issued ASU~~ ~~2020~~-4, ~~Reference Rate Reform (Topic~~ ~~848~~~~)—Facilitation~~subsidiaries and are collateralized by certain of the ~~Effects of Reference Rate Reform on Financial Reporting. The guidance of this ASU is designed to provide relief from the accounting analysis and impacts that~~ ~~may~~ otherwise be required for modifications to agreements (e.g., loans, debt securities, derivatives, borrowings) necessitated by reference rate reform. It also provides optional expedients to enable companies to continue to apply hedge accounting to certain hedging relationships impacted by reference rate reform. Application of the guidance is optional, is only available in certain situations, and is only available for companies to apply until ~~December 31, 2022.~~ ~~The Company is currently reviewing its agreements impacted by the reference rate reform and does~~ ~~not~~ ~~expect this ASU to have a material impact to the~~ Company’s ~~financial statements.~~

In ~~August 2020,~~ ~~the FASB issued ASU~~ ~~2020~~-~~06,~~ ~~Debt–Debt with conversion and Other Options (Subtopic~~ ~~470~~-20~~) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic~~ ~~815~~-40)—Accounting for Convertible Instruments and Contracts in an Entity's Own Equity. The amendments in this ASU address issues identified as a result of the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity. The amendments reduce the number of accounting models for convertible debt instruments and convertible preferred stock, and address convertible instruments with conversion features, as well as other items. This ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after ~~December 15, 2021.~~ ~~The Company will adopt this ASU as required and does~~ ~~not~~ ~~expect it to have a material impact to the Company’s financial statements.~~assets.

Earnings (loss) per common share is computed using the two-class method related to its Series A Redeemable Convertible Preferred Stock, par value of $0.0001 (“Preferred Stock”). Under the two-class method, undistributed earnings available to stockholders for the period are allocated on a pro rata basis to the common stockholders and to the holders of the Preferred Stock based on the weighted average number of common shares outstanding and number of shares that could be issued upon

Diluted earnings per share is computed using the weighted average number of common shares outstanding and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the dilutive incremental common shares associated with restricted stock awards and shares issuable upon the exercise of stock options, using the treasury stock method, and the potential common shares that could be issued from conversion of the Preferred Stock, using the if-converted method. When a net loss occurs, potential common shares have an anti-dilutive effect on earnings per share and such shares are excluded from the diluted earnings per share calculation.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, the Company incurred a net ~~loss~~losses from operations, therefore basic and diluted net loss per share are the same for ~~the periods.~~each period. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, approximately 0.8 million restricted shares, ~~1.5~~1.4 million shares issuable upon exercise of options and ~~9.5~~7.3 million common shares issuable upon the conversion of the Preferred Stock were excluded from dilutive potential common shares for the periods as they were anti-dilutive. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, ~~0.3~~0.8 million restricted shares, ~~0.2~~1.5 million shares issuable upon exercise of options and ~~8.9~~9.4 million common shares issuable upon conversion of the Preferred Stock were excluded from dilutive potential common shares for the periods as they ~~are~~were anti-dilutive.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, the Company calculated earnings (loss) per share as follows:

The Company’s guests remit deposits in advance of tour embarkation. Guest deposits consist of guest ticket revenues as well as revenues from the sale of pre- and post-expedition excursions, hotel accommodations, land-based expeditions and air transportation to and from the ships. Guest deposits represent unearned revenues and are reported as unearned passenger revenues in the condensed consolidated balance sheets when received and are subsequently recognized as tour revenue over the duration of the trip. Accounting Standards Codification, Revenue from Contracts with Customers (Topic 606) defines a “contract liability” as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. The Company does not consider guest deposits to be a contract liability until the guest no longer has the right, resulting from the passage of time, to cancel their reservation and receive a full refund. In conjunction with the suspension or rescheduling of expeditions, the Company provided guests an option of either a refund or future travel certificates, which in some instances exceeded the original cash deposit. The Company has recorded liabilities up to the amount of cash ~~deposits and~~deposits. The additional value of any future travel certificates are being recognized as a discount when applied to future expeditions. The change in contract liabilities within unearned passenger revenues presented in our condensed consolidated balance sheets are as follows:

The following table disaggregates our tour revenues by the sales channel it was derived from:

The following is a reconciliation of cash, cash equivalents and restricted cash to the statement of cash flows:

~~The Company’s~~As of June 30, 2022 and December 31, 2021, prepaid tour expenses of $25.8 million and $10.3 million, respectively, is the only item of prepaid expenses and other current assets ~~consist~~in excess of ~~the following:~~5% of current assets.

~~The Company’s~~and December 31, 2021, accounts payable of $17.8 million and $9.7 million, respectively, is the only item of accounts payable and accrued expenses ~~consist~~in excess of ~~the following:~~5% of current liabilities.

~~During~~In ~~August~~ 2021,the Company received a ~~$21.0~~$27.0 million grant under the CERTS Act, which provided grants to eligible motorcoach, school bus, passenger vessel, and pilotage companies that have experienced annual revenue losses of 25 percent or more as result of COVID-19. The priority use of grant funds ~~must~~was required to be for payroll costs, though grants ~~may~~ could be used for operating expenses and the repayment of debt accrued to maintain payroll. The Company ~~is accounting~~had accounted for the grant as a current liability on its balance sheet, as any amounts not appropriately used within one year of the grant date ~~must~~would have to be returned to the U.S. Treasury and, ~~will recognize~~as permitted expenses for the grant were incurred the corresponding amounts were recognized in other income on the income ~~statement as permitted expenses for the grant are incurred.~~statement. During the three ~~and~~ ~~nine~~months ended ~~September 30, 2021,~~March 31, 2022, the Company recognized ~~$4.4~~the remaining $11.6 million of the CERTS grant in other income for permitted payroll costs and ship operating ~~expenses.~~expenses, and as of June 30, 2022, has no further liability recorded for the grant.

The Company’s loan receivable is recorded at amortized cost within other ~~long-term~~current assets. The Company reviewed its loan receivable for credit losses in connection with the preparation of its condensed consolidated financial statements for the period ended ~~September~~June 30, ~~2021.~~2022. In evaluating the allowance for loan losses, the Company considered factors such as historical loss experience, the type and amount of loan, adverse situations that may affect the borrower’s ability to repay and prevailing economic conditions. Based on these credit loss estimation and experience factors, the Company realized 0 allowance for loan loss for the ~~three~~ or ~~nine~~six months ended ~~September~~June 30, ~~2021.~~2022. The following is a rollforward of the loan receivable balance:

For the three and ~~nine~~six months ended ~~September~~June 30, 2022, deferred financing costs charged to interest expense was $0.7 million and $1.4 million, respectively. For the three and six months ended June 30, 2021, deferred financing costs charged to interest expense ~~were~~was $0.8 ~~million and $2.3 million, respectively. For the~~ ~~three~~ ~~and~~ ~~nine~~ ~~months ended~~ ~~September 30, 2020,~~ ~~deferred financing costs charged to interest expense were $0.5~~ million and $1.5 million, respectively. During the three months ended March 31, 2022, $9.0 million of deferred financing costs related to the repayment of the Company’s prior credit agreement, including the term facility, Main Street Loan and revolving credit facility were written-off to other expense.

InOn ~~March 2018,~~February 4, 2022, the Company issued $360.0 million aggregate principal amount of 6.75% senior secured notes due 2027 (the “Notes”) in a private offering. The Notes bear interest at a rate of 6.75% per year, accruing from February 4, 2022, and interest on the Notes is payable semiannually in arrears on February 15 and August 15 of each year, beginning on August 15, 2022. The Notes will mature on February 15, 2027, subject to earlier repurchase or redemption. The Company used the net proceeds from the offering to prepay in full all outstanding borrowings under its prior credit agreement, including the term facility, Main Street Loan, and revolving credit facility, to pay any related premiums and to terminate in full its prior credit agreement and the commitments thereunder. The Notes are senior secured obligations of the Company and are guaranteed on a senior secured basis by the Company and certain of the Company’s subsidiaries (collectively, the “Guarantors”) and secured by first-priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all the assets of the Company and the Guarantors. The Notes may be redeemed by the Company, at set redemption prices and premiums, plus accrued and unpaid interest, if any.

The Notes contain covenants that, among other things, restrict the Company’s ability, and the ability of the Company’s restricted subsidiaries, to incur certain additional indebtedness and make certain dividend payments, distributions, investments and other restricted payments. These covenants are subject to a number of important exceptions and qualifications set forth in the Notes.

On February 4, 2022, the Company entered into ~~the Third Amended and Restated Credit Agreement (the “Amended Credit Agreement”) providing for~~ a ~~$200.0 million senior secured term facility (the “Term Facility”), maturing~~ ~~March 2025,~~ ~~and a $45.0 million~~new senior secured revolving credit facility (the ~~“Revolving~~“New Revolving Credit Facility”), which provides for an aggregate principal amount of commitments of $45.0 million, maturing ~~March 2023,~~February 2027, ~~which includes~~including a ~~$5.0 million~~ letter of credit ~~sub-facility. In~~ ~~March 2020,~~ sub-facility in an aggregate principal amount of up to $5.0 million. The obligations under the New Revolving Credit Facility are guaranteed by the Company ~~drew $45.0 million against~~and the ~~Revolving Facility as a reserve for general corporate purposes~~Guarantors and ~~other expense needs due~~are secured by first-priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all the ~~uncertainty related to the COVID-~~19 ~~pandemic.~~

In ~~August 2020,~~ assets of the Company ~~amended the Amended Credit Agreement to waive the application of the total net leverage ratio covenant through~~ ~~June 2021.~~ In connection with the amendment, the interest rate of the Term Facility was increased 125 basis points, to be paid-in-kind at maturity, a LIBOR minimum of 0.75% was added to the Term Facility and certain covenants were amended to be more restrictive.

In ~~December 2020,~~ ~~the Company amended the Amended Credit Agreement to provide for the borrowing of a new tranche of incremental term loans under the Amended Credit Agreement in an amount of $85.0 million, maturing~~ ~~December 2025,~~ ~~made under the Main Street Expanded Loan Facility (the “Main Street Loan”). Interest on the Main Street Loan shall be paid-in-kind for the~~ ~~first~~ ~~year~~ and the ~~principal shall amortize at a rate of 15% in each of the~~ ~~third~~ ~~and~~ ~~fourth~~ ~~years, with the remaining amounts to be paid at maturity. The Company~~ ~~may~~ ~~voluntarily prepay the Main Street Loan at any time and from time to time, without premium or penalty, other than customary “breakage costs” and fees for LIBOR-based loans.~~

~~During~~ ~~April 2021,~~ ~~the Company further amended its Amended Credit Agreement to, among other things, extend the waiver of its total net leverage ratio covenant through~~ ~~March 2022,~~ ~~annualize EBITDA used in its covenant calculation through~~ ~~December 31, 2022~~ and increase the interest rate spreads of the Term Facility, excluding the Main Street Loan, and the Revolving Facility by 50 basis points. Certain other covenants under the Amended Credit Agreement continue to be more restrictive during the extended covenant waiver period.

The Term Facility, as amended, bears interest at an adjusted Intercontinental Exchange (“ICE”) Benchmark administration LIBOR with a minimum of 0.75%, plus a spread of 5.25%, for an aggregated rate of 6.00% as of ~~September 30, 2021.~~ ~~125 basis points of the spread are to be paid-in-kind at maturity.~~Guarantors. Borrowings under the New Revolving Credit Facility, ~~as amended, bears interest at an adjusted ICE Benchmark administration LIBOR, plus a spread of 3.50%, for an aggregated rate of 3.58% as of~~ ~~September 30, 2021.~~ ~~The Main Street Loan bears~~if any, will bear interest at a rate per annum equal to, at the Company’s option, an adjusted ~~ICE Benchmark administration LIBOR for an interest period of~~ 3~~-months~~Secured Overnight Financing Rate (“SOFR”) rate plus ~~3.00%, for an aggregated~~a spread or a base rate ~~of 3.13% as of~~ ~~September 30, 2021.~~plus a spread.

The New Revolving Credit Facility contains customary affirmative and negative covenants, as well as financial covenants and event of default provisions.

In January 2018, the Company entered into a senior secured credit agreement (the “First Export Credit Agreement”) ~~with Citibank, N.A., London Branch and Eksportkreditt Norge AS, to make~~making available to the Company a loan in an aggregate principal amount not to exceed $107.7 million for the purpose of providing financing for up to 80% of the purchase price of the Company’s new ice class vessel, the National Geographic Endurance~~. During~~, delivered in March ~~2020,~~2020. ~~the Company took possession of the~~ ~~National~~

~~Geographic Endurance~~ ~~and borrowed $107.7 million under the First Export Credit Agreement for final payment~~.In June ~~2020,~~2021, the Company amended its First Export Credit Agreement to, ~~defer scheduled amortization payments from~~ ~~June 2020~~ ~~through~~ ~~March 2021~~ ~~and to suspend the total net leverage ratio covenant from~~ ~~June 2020~~ ~~through~~ ~~June 2021.~~ ~~During~~ ~~June 2021,~~ ~~the Company further amended its First Export Credit Agreement to,~~ among other things, ~~extend~~waive the ~~deferral of scheduled amortization payments through~~ ~~December 2021~~ ~~in the aggregate amount of $15.7 million, extend the waiver of its total~~ net leverage coverage ratio ~~covenants~~ through March ~~31,~~ 2022 ~~increase the interest rate spread by 50 basis points~~ and annualize EBITDA used in its covenant calculation through December 31, 2022. ~~The deferred principal payments will amortize quarterly over~~During ~~three~~May 2022, ~~years starting in~~the Company further amended its First Export Credit Agreement to extend the waiver of its net leverage coverage ratio from March 2022 through December 31, 2022. Certain other covenants continue to be more restrictive during the extended covenant waiver period. The First Export Credit Agreement, as amended, bears interest at a ~~floating~~variable interest rate equal to three-month LIBOR plus a margin of 3.50% per annum, for an aggregated rate of ~~3.62%~~5.22% over the borrowing period covering ~~September~~June 30, ~~2021.~~2022.

In April 2019, the Company entered into a senior secured credit agreement (the “Second Export Credit Agreement”) ~~with Citibank, N.A.~~, ~~London Branch and Eksportkreditt Norge AS,~~ to make available to the Company ~~at the Company's option~~ and subject to certain conditions, a loan in an aggregate principal amount not to exceed $122.8 million for the purpose of providing pre- and post-delivery financing for up to 80% of the purchase price of the Company’s new expedition ice-class cruise vessel, the National Geographic Resolution~~. During~~, delivered in September 2021, ~~the Company took possession of the~~ ~~National Geographic Resolution~~and ~~as of~~ ~~September 30, 2021~~ ~~had~~ borrowed $122.8 million under the Second Export Credit ~~Agreement, drawing approximately $30.5 million in~~ ~~2019,~~ ~~$30.6 million in~~ ~~2020~~ ~~and $61.7 million in~~ ~~2021.~~Agreement. In June ~~2020,~~2021, the Company amended its Second Export Credit Agreement to, ~~suspend~~among other things, waive the ~~total~~ net leverage coverage ratio ~~covenant from~~ ~~June 2020~~ through ~~June 2021.~~March 2022 and annualize EBITDA used in its covenant calculation through December 31, 2022. During ~~June 2021,~~May 2022, the Company further amended its Second Export Credit Agreement to ~~among other things,~~ extend the waiver of its ~~total~~ net leverage coverage ratio ~~covenants through~~from March ~~31,~~ 2022 ~~increase the interest rate spread by 50 basis points and annualize EBITDA used in its covenant calculation~~ through December 31, 2022. Certain other covenants continue to be more restrictive during the extended covenant waiver period. The Second Export Credit Agreement, as amended, bears a variable interest rate equal to three-month LIBOR plus a margin of 3.50% per annum, ~~or 3.63%~~for an aggregated rate of 5.56% over the borrowing period covering ~~September~~June 30, ~~2021.~~2022.

In connection with the Natural Habitat acquisition in May 2016, Natural Habitat issued a $2.5 million unsecured promissory note, amended in May 2020, to Benjamin L. Bressler, the founder of Natural Habitat, with an outstanding principal amount of ~~$1.7~~$0.8 million as of ~~September~~June 30, ~~2021.~~2022. The promissory note accrues interest at a rate of 1.44% annually, with interest payable every six months and the remaining principal ~~payments to be~~payment due ~~in equal installments~~ on December 22, ~~2021~~2022.

The Company’s Off the Beaten Path subsidiary has a loan maturing June 2023 for the purchase of guest transportation vehicles. The loan’s original principal was $0.3 million, is collateralized by the vehicles and bears an interest rate of 4.77% annually.

The Company’s Off the Beaten Path subsidiary has a $0.8 million loan under the Main Street Expanded Loan Facility, originated on December 11, 2020. For the first12 months, interest was not payable and accrued to the principal balance, thereafter, monthly interest payments are required. The outstanding balance will amortize at a rate of 15% on both December 2023 and December 2024, with the remaining balance due December 2025. The loan bears a variable interest rate equal to one-month LIBOR plus a spread of 3.00%, or 4.79% as of June 30, 2022.This loan may be voluntarily prepaid at any time and from time to time, without premium or penalty, other than customary “breakage costs” and fees for LIBOR-based loans.

The Company’s DuVine subsidiary has a EUR 0.1 million State Assistance Loan related to the financial consequences of the COVID-19 pandemic, for the purpose of employment preservation. This loan matures August 2025, with monthly payments, and bears an interest rate of 0.53% annually.

The Company’s ~~Amended~~Notes, New Revolving Credit ~~Agreement,~~Facility, First Export Credit Agreement and Second Export Credit Agreement contain financial and restrictive covenants that include among others, net leverage ratios, limits on additional indebtedness and limits on certain investments. ~~As of~~ ~~September 30, 2021,~~ ~~the~~The net leverage ratio covenant of the Company’s ~~Amended Credit Agreement,~~ First Export Credit Agreement and Second Export Credit Agreement have been waived through ~~March~~December 31, 2022. The Company was in compliance with its covenants in effect as of ~~September~~June 30, ~~2021.~~2022 and estimates that it will be in compliance for the next 12 months.

The Company’s derivative assets and liabilities consist principally of foreign exchange forward contracts and interest rate caps and are carried at fair value based on significant observable inputs (Level 2 inputs). Derivatives entered into by the Company are typically executed over-the-counter and are valued using internal valuation techniques, as quoted market prices are not readily available. The valuation technique and inputs depend on the type of derivative and the nature of the underlying exposure. The Company principally uses discounted cash flows along with fair value models that primarily use market observable inputs. These models take into account a variety of factors including, where applicable, maturity, currency exchange rates, interest rate yield curves and counterparty credit risks.

Currency Risk. The Company uses currency exchange forward contracts to manage its exposure to changes in currency exchange rates associated with certain of its ~~non-U.S.-dollar~~non-U.S. dollar denominated receivables and payables. The Company primarily economically hedges a portion of its current-year currency exposure to the Canadian and New Zealand dollars, the Brazilian Real, the South African Rand, the Euro and the British pound sterling. The fluctuations in the value of these forward contracts largely offset the impact of changes in the value of the underlying risk they economically hedge.

Interest Rate Risk. The Company ~~uses~~previously used interest rate caps ~~designated as cash flow hedges,~~ to manage the risk related to its ~~floating~~previously existing variable rate corporate debt.

The Company ~~records~~recorded the effective portion of changes in the fair value of its cash flow hedges to other comprehensive income (loss), net of tax, and subsequently ~~reclassifies~~reclassified these amounts into earnings in the period during which the hedged transaction iswas recognized. Any changes in fair values of hedges that are determined to be ineffective are immediately reclassified from accumulated other comprehensive income (loss) into earnings. ~~NaN gains or losses of the Company’s cash flow hedges were considered to be ineffective and reclassified from other comprehensive income (loss) to earnings for the period ended~~ ~~September 30, 2021.~~ The Company reclassified ~~$2.7~~$0.6 million from other comprehensive income (loss) to earnings for the period ended ~~September 30, 2021~~March 31, 2022 due to the ~~maturity~~termination of a cash flow hedge relationship between the Company’s interest rate caps and the ~~hedged item. The Company estimates that it will~~ ~~not~~ ~~recognize any losses currently recorded in accumulated other comprehensive income (loss) in earnings over the next~~Company’s underlying corporate variable rate debt, which was repaid during 12February 2022. ~~months. The Company will continue to assess the effectiveness of the hedges on an ongoing basis.~~

The Company held the following derivative instruments with absolute notional values as of ~~September~~June 30, ~~2021:~~2022:

Changes in the fair value of the Company’s hedging instruments are recorded in accumulated other comprehensive ~~income, pursuant to the guidelines of cash flow hedge accounting as outlined in ASC~~ ~~815.~~income. The effects of derivatives recognized in the Company’s condensed consolidated financial statements were as follows:

~~Fair Value Measurements~~In connection with the acquisition of Classic Journeys, the purchase agreement includes a contingent consideration earnout, see Note 11—Acquisitions, which is required to be recorded at fair value at each period. The possible contingent acquisition consideration earnout is either 0 or $0.6 million, depending on the achievement of certain average annual net profits targets for the years ended December 31, 2022 and 2023 by the acquired operation. As of June 30, 2022, the contingent liability had a value of $0.3 million using a Level 3 valuation method, which was recorded in other long-term liabilities.

The carrying amounts of cash and cash equivalents, accounts payable and accrued expenses, approximate fair value due to the short-term nature of these instruments. The ~~carrying~~Company estimates the approximate fair value of its long-term debt ~~approximates fair value given that~~to be $483.6 million as of June 30, 2022, based on the terms of the agreements ~~were~~and comparable ~~to the~~ market data as of ~~September~~June 30, ~~2021.~~2022. As of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, the Company had no other significant liabilities that were measured at fair value on a recurring basis.

The Company’s Board of Directors approved a stock and warrant repurchase plan (“Repurchase Plan”) in November 2015 and increased the repurchase plan to $35.0 million in November 2016. The Repurchase Plan authorizes the Company to purchase, from time to time, the Company’s outstanding common stock and previously outstanding warrants. Any shares purchased will be retired. The Repurchase Plan has no time deadline and will continue until otherwise modified or terminated at the sole discretion of the Company’s Board of Directors. These repurchases exclude shares repurchased to settle statutory employee tax withholding related to the exercise of stock options and vesting of stock awards. In ~~March 2020,~~ ~~the Repurchase Plan was suspended due to the uncertain impact of the COVID-~~19 ~~pandemic and borrowings through the Main Street Expanded Loan Facility program restricts stock repurchases.~~ The Company has cumulatively repurchased 875,218 shares of common stock for $8.3 million and 6,011,926 warrants for $14.7 million, since plan inception. The remaining balance for the Repurchase Plan was $12.0 million as of ~~September~~June 30, ~~2021.~~2022. The Repurchase Plan is suspended due to restrictions related to the Main Street Expanded Loan Facility program.

OnIn August ~~31,~~ 2020, the Company issued and sold 85,000 shares of Preferred Stock for $1,000 per share for gross proceeds of $85.0 million. The Preferred Stock has senior and preferential ranking to the Company’s common stock. The Preferred Stock is entitled to cumulative dividends of 6.00% per annum, and for the first two years the dividends will be paid-in-kind. After the second anniversary of the issuance date, the dividends may be paid-in-kind or be paid in cash at the Company’s option. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of common stock of the Company equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $9.50. At any time after the third anniversary of the issuance, the Company may, at its option, convert all, but not less than all, of the Preferred Stock into common stock if the closing price of shares of common stock is at least 150% of the conversion price for 20 out of 30 consecutive trading days. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of common stock ~~received in such conversion shall be equal to the quotient obtained by dividing the then-current accrued value by the conversion price. At the~~ ~~six~~~~-year anniversary of the closing date, each investor has the right to require the Company to repurchase their Preferred Stock and any Preferred Stock~~ ~~not~~ ~~requested to be repurchased shall be converted into common shares~~ of the Company equal to the quotient obtained by dividing the then-current accrued value by the conversion ~~price.~~price of $9.50. The Preferred Stock deferred issuance costs were approximately ~~$2.9~~$2.1 million as of ~~September~~June 30, ~~2021.~~2022, recorded as reduction to preferred stock on balance sheet. During the year ended December 31, 2021, 5,000 shares of Preferred Stock and related accumulated dividends were converted by the holder into 566,364 shares of the Company’s common stock. During the six months ended June 30, 2022, 18,000 shares of Preferred Stock and related accumulated dividends were converted by the holder into 2,109,561 shares of the Company’s common stock. The Company recorded accrued dividends for Preferred Stock of $1.3 million and ~~$4.0~~$2.6 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, and ~~$0.4~~$1.3 million and $2.6 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021, respectively. As of ~~September~~June 30, ~~2021,~~2022, the 62,000 shares of Preferred Stock outstanding and accumulated dividends could be converted at the option of the holders into approximately ~~9.5~~7.3 million shares of the Company’s common stock.

The Company is authorized to issue up to 4.7 million shares of common stock under the 2021 Long-Term Incentive Plan (“the Plan”) which was approved by shareholders in June 2021. As of ~~September~~June 30, ~~2021,~~2022, approximately ~~3.9~~3.7 million shares were available to be granted under the Plan.

As of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~2021, options to purchase an aggregate of ~~1.5~~1.4 million and ~~510,000~~1.5 million shares of the Company’s common stock, respectively, with a weighted average exercise price of ~~$14.37~~$15.10 and $10.30, respectively, were outstanding. As of ~~September~~June 30, ~~2021,~~2022, ~~188,000~~388,000 options were exercisable.

The Company recorded stock-based compensation expense of ~~$1.4~~$1.8 million and ~~$4.1~~$3.7 million, during the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, and ~~$0.3~~$1.1 million and ~~$1.9~~$2.7 million during the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, respectively.

During the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, the Company granted ~~224,506~~247,470 restricted stock units ("RSUs") with a weighted average grant price of ~~$17.45.~~$15.02. The RSUs will primarily vest equally over three years on the anniversary of the grant date, subject to the recipient’s continued employment or service with the Company on the applicable vesting date. The number of shares were determined based upon the closing price of our common stock on the date of the award.

During the ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, the Company awarded ~~50,072~~56,209 market performance share units (“MSUs”) with a weighted average grant price of ~~$18.90.~~$15.08. The MSUs are market-based equity incentive awards based on a performance-multiplier of change in the stock price of the Company’s common stock between the grant date and March 31, ~~2024.~~2025. The number of shares that will eventually be earned and vest may be more or less ~~then~~than the number of MSUs that are awarded, depending on the Company's common stock price, at a level ranging from 0% to 150%. The number of MSUs earned shall be determined and shall vest on March 31, ~~2024.~~2025.

~~As a new grant under his compensation agreement, the Company granted to Mr. Berle, the Company’s new Chief Executive Officer, 1.0 million options on~~ ~~May 10, 2021~~ ~~and, after Mr. Berle purchased a required amount of the Company’s common stock in the open market, as specified in this compensation agreement, granted 58,452 RSUs to him on~~ ~~June 3, 2021.~~ ~~The options were granted with an exercise price of $16.38, and vest ratably over~~ ~~five~~ ~~years and the RSUs were granted with a weighted average grant price of $17.33 and vest ratably over~~ ~~five~~ ~~years.~~

In connection with the acquisition of Natural Habitat, Mr. Bressler, the founder of Natural Habitat, has an equity incentive opportunity to earn an award of options based on the future financial performance of Natural Habitat, where if the Final Year Equity Value of Natural Habitat, as defined in Mr. Bressler's amended employment agreement, exceeds ~~$25~~$25.0 million, effective as of December 31, 2023, Mr. Bressler will be granted options with a fair value equal to 10.1% of such excess, subject to certain conditions.

Mr. Lawrence, President of Off the Beaten Path, was issued 1,007 profit interest units in the equity of Off the Beaten Path as part of the acquisition. The profit interest units had a $132.86 per share grant date fair value and are considered vested upon issuance. The Company recorded $0.1 million in stock-based compensation expense related to the value of these profit units for the ~~nine~~ ~~months ended~~ ~~September 30, 2021,~~ ~~included in the Company’s total stock-based compensation disclosed above.~~

In May 2016, in connection with the Company's acquisition of Natural Habitat, Natural Habitat issued an unsecured promissory note, amended May 2020, to Mr. Bressler, the founder of Natural Habitat. See Note 55—Long ~~— Long-term~~-term Debt for more information.

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The measurement of net deferred tax assets is reduced by the amount of any tax benefit that, based on available evidence, is ~~not~~ expected to be realized, and a corresponding valuation allowance is established. The determination of the required valuation allowance against net deferred tax assets was made without taking into account the deferred tax liabilities created from the book and tax differences on indefinite-lived assets.

The Company accounts for income taxes using the asset and liability method, under which it recognizes deferred income taxes for the tax consequences attributable to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities, as well as for tax loss carryforwards and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recoverable or settled. The Company recognizes the effect on deferred taxes of a change in tax rates

~~in income in the period that includes the enactment date. The Company provides a valuation allowance against deferred tax assets if, based upon the weight of available evidence, the Company does~~ ~~not~~ ~~believe it is “more-likely-than-~~~~not”~~ that some or all of the deferred tax assets will be realized. The Company will continue to evaluate the deferred tax asset valuation allowance balances in all of our foreign and U.S. companies to determine the appropriate level of valuation allowances.

The Company is subject to income taxes in both the U.S. and the non-U.S. jurisdictions in which it operates. The Company regularly assesses the potential outcome of current and future examinations in each of the taxing jurisdictions when determining the adequacy of the provision for income taxes. The Company has only recorded financial statement benefits for tax positions which it believes reflect the “more-likely-than-~~not”~~ criteria of FASB’s authoritative guidance on accounting for uncertainty in income taxes, and it has established income tax reserves in accordance with this guidance where necessary. Once a financial statement benefit for a tax position is recorded or a tax reserve is established, the Company adjusts it only when there is more information available or when an event occurs necessitating a change. While the Company believes that the amount of the recorded financial statement benefits and tax reserves reflect the more-likely-than-~~not~~ ~~criteria, it is possible that the ultimate outcome of current or future examinations~~ ~~may~~ ~~result in a reduction to the tax benefits previously recorded on its condensed consolidated financial statements or~~ ~~may~~ ~~exceed the current income tax reserves in amounts that could be material.~~ As of ~~September~~June 30, ~~2021,~~2022 and December 31, ~~2020,~~2021, the Company had ~~a liability for~~0 unrecognized tax benefits ~~of $0.0 million. The Company’s policy is to record interest and penalties on uncertain tax positions as a component of income tax expense. During the~~ ~~three~~ ~~and~~ ~~nine~~ ~~months ended~~ ~~September 30, 2021~~ ~~and~~ ~~2020,~~ ~~interest and penalties related to uncertain tax positions included in income tax expense are~~ ~~not~~ ~~significant.~~recorded. The Company's effective tax rate for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 was ~~an expense of 12.1% and~~a benefit of ~~2.8%~~3.3% and 1.5%, respectively, ~~primarily due to lower losses in the~~ ~~third~~ ~~quarter then forecast~~versus a benefit of 6.2% and ~~the amount of losses expected for the full year~~ ~~2021.~~ ~~The effective tax rates~~6.9% for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021, ~~were a benefit of 9.5% and 9.9%,~~ respectively, primarily due to the expected results for 2022 compared to the 2021 results due to the impact of the COVID-19 pandemic on the Company's operations.

The Company is subject to tax audits in all jurisdictions for which it files tax returns. Tax audits by their very nature are often complex and can require several years to complete. Currently, there are no ~~U.S. federal, state or foreign jurisdiction tax audits pending. The Company’s corporate U.S. federal and state tax returns for the current year and~~ ~~three~~ ~~prior years remain subject to examination by tax authorities and the Company’s foreign tax returns for the current year and~~ ~~four~~ ~~prior years remain subject to examination by tax authorities.~~

To further expand the Company’s land-based experiential travel offerings and increase its addressable market, onthe Company completed three acquisitions during 2021. On February 1, 2021,the Company acquired ~~through its Natural Habitat subsidiary, 90.1%~~80.1% of the outstanding common stock of Off the Beaten Path, ~~LLC,~~ a land-based travel operator specializing in authentic national park experiences, ~~and~~ on March 3, 2021, the Company acquired 70% of the outstanding common stock of DuVine, ~~Cycling + Adventure LLC,~~ an international luxury cycling and adventure company focused on exceptional food and wine ~~experiences.~~experiences, and on October 13, 2021, the Company acquired 80.1% of Classic Journeys, a leading luxury walking tour company.

The acquisitions had an aggregate purchase price of ~~$10.6~~$23.6 million, including $1.8 million in Company stock ~~at closing.~~and $0.2 million in deferred contingent consideration. The deferred contingent consideration has an earnout potential between 0 and $0.6 million. The acquisitions were accounted for under purchase accounting and are included in ~~our~~the Company's consolidated ~~results from~~financial statements since the ~~acquisition dates. Acquisition related cost were approximately $0.4 million and are included in general and administrative expenses in~~date of the ~~condensed consolidated statements of operations for the~~ ~~nine~~ ~~months ended~~ ~~September 30, 2021.~~ acquisitions. The Company preliminarily recorded ~~approximately $6.5~~$10.4 million in intangible assets related to tradenames and customer lists and ~~approximately $10.7~~$19.9 million in goodwill related to these acquisitions. The ~~acquired businesses contributed aggregate revenue of $10.5 million and $14.0 million during the~~ ~~three~~ ~~and~~ ~~nine~~ ~~months ended~~ ~~September 30, 2021,~~ ~~respectively, while their aggregate net income contributed~~amount recorded for the ~~three~~intangible assets and ~~nine~~ ~~months ended~~ ~~September 30, 2021~~ ~~was immaterial~~goodwill is subject to possible adjustment when the ~~Company's financial statements. Following are pro forma revenue and net loss available to stockholders for the~~ ~~three~~ ~~and~~ ~~nine~~ ~~months ended~~ ~~September 30, 2021~~ ~~and~~ ~~2020,~~ ~~assuming the Company had completed the acquisitions on~~ ~~January 1, 2020:~~

~~In addition to the businesses acquired above, during~~ ~~September 2021,~~ ~~the Company acquired the Crystal Esprit yacht for $13.3 million. The Company expects to modify the vessel to a capacity~~valuation of 48 ~~guest, along with other changes, and replace the~~ ~~National Geographic Islander~~ ~~with it in the Galapagos.~~Classic Journeys is finalized.

~~Mr. Bressler, founder of~~The Company has controlling interests in its Natural Habitat, ~~retains a 19.9%~~Off the Beaten Path, DuVine and Classic Journeys consolidated subsidiaries. The noncontrolling ~~interest in Natural Habitat, which is~~interests are subject to a put/call ~~arrangement, amended in~~agreements. The put options enable the minority holders, but do ~~May 2020.~~ not~~The arrangement between~~ obligate them, to sell the ~~Company and Mr. Bressler was established in order~~remaining interests to ~~provide a formal exit opportunity for Mr. Bressler and a path to~~ ~~100%~~ ~~ownership for~~ the Company. ~~Mr. Bressler~~The Company has ~~a put option that under certain conditions, and subject to providing notice by~~ ~~January 31, 2024,~~ ~~that enables him,~~call options which enable it, but does not obligate ~~him,~~it, to ~~sell his~~acquire the remaining ~~interest~~interests in ~~Natural Habitat to~~ the ~~Company, valued as of~~ ~~December 31, 2023.~~ ~~The Company has a call option, but~~ ~~not~~ ~~an obligation, on or after~~ ~~January 31, 2024,~~ ~~with an expiration of~~ ~~March 31, 2029,~~ ~~under which it can buy Mr. Bressler’s remaining interest at a similar fair value measure as Mr. Bressler’s put option,~~subsidiaries, subject to ~~a call~~certain dates, expirations and similar redemption value purchase ~~price minimum.~~

~~Mr. Lawrence, through a combination of his original minority interest and~~measurements as the profit interest units he received, retains a 19.9% noncontrolling interest in Off the Beaten Path, which is subject to a put/call arrangement. The arrangement between the Company and Mr. Lawrence was established in order to provide a formal exit opportunity for Mr. Lawrence and a path to ~~100%~~ ~~ownership for the Company. Mr. Lawrence has a~~ put ~~option, that under certain conditions and subject to providing notice by~~ ~~October 31, 2025,~~ ~~that enables him, but does~~ ~~not~~ ~~obligate him, to sell his remaining interest in Off the Beaten Path to the Company on~~ ~~December 31, 2025.~~ ~~The Company has a call option, but~~ ~~not~~ ~~an obligation, on or after~~ ~~October 31, 2025,~~ ~~with an expiration of~~ ~~December 31, 2030,~~ ~~under which it can buy Mr. Lawrence’s remaining interest at a similar fair value measure as Mr. Lawrence’s put option.~~

Mr. Levine, founder of DuVine, retains a 30% noncontrolling interest in DuVine, which is subject to a put/call arrangement. The arrangement between the Company and Mr. Levine was established in order to provide a formal exit opportunity for Mr. Levine and a path to ~~100%~~ ~~ownership for the Company. Mr. Levine has a put option, that under certain conditions and subject to providing notice by~~ ~~January 31, 2026,~~ ~~that enables him, but does~~ ~~not~~ ~~obligate him, to sell his remaining interest in DuVine to the Company as of~~ ~~December 31, 2025.~~ ~~The Company has a~~ ~~first~~ ~~call option, but~~ ~~not~~ ~~an obligation, on or after~~ ~~December 31, 2023,~~ ~~expiring~~ ~~December 31, 2025,~~ ~~to acquire an additional 10% of DuVine from Mr. Levine, and a~~ ~~second~~ ~~call option, but~~ ~~not~~ ~~an obligation, on or after~~ ~~December 31, 2025,~~ ~~with an expiration of~~ ~~December 31, 2030,~~ ~~under which it can buy Mr. Levine’s remaining interest at a similar fair value measure as Mr. Levine’s put option, subject to a call purchase price minimum.~~options.

Since the redemption of the noncontrolling interests are not solely in the Company’s control, the Company is required to record the redeemable noncontrolling interest outside of stockholders’ equity but after its total liabilities. In addition, if it is probable that the instrument will become redeemable, as such solely due to the passage of time, the redeemable noncontrollable interest should be adjusted to the redemption value via one of two measurement methods. The Company elected the income classification-excess adjustment and accretion methods for recognizing changes in the redemption value of the put options. Under this methodology, a calculation of the present value of the redemption value is compared to the carrying value of the redeemable noncontrolling interest and the carrying value of the redeemable noncontrolling interest is adjusted to the redemption value’s present value. Any adjustments to the carrying value of the redeemable noncontrolling interest, up to the ~~fair~~redemption value of the noncontrolling interest, are classified to retained earnings. Adjustments in excess of the ~~fair~~redemption value of the noncontrolling interest, are treated as a decrease to net income available to common stockholders.

The ~~fair~~redemption value of the put options were determined using a discounted cash flow model. The redemption values were adjusted to their present value using the Company’s weighted average cost of capital.

The Company is party to an alliance and license agreement with National Geographic, which allows the Company to use the National Geographic name and logo. In return for these rights, the Company is charged a royalty fee. The royalty fee is included

within selling and marketing expense on the accompanying condensed consolidated statements of operations. The ~~amount~~fee is calculated based upon a percentage of certain ticket revenues less travel agent commission, including the revenues received from cancellation fees and any revenues received from the sale of pre- and post-expedition extensions. Royalty expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 was ~~$0.7~~$1.7 million and ~~$0.9~~$2.9 million, respectively, and ~~$0.0~~was $0.1 million ~~and $1.3 million~~ for both the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~ 2021.~~respectively.~~

The royalty balance payable to National Geographic as of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020~~2021 was ~~$0.7~~$2.1 million and ~~$0.0~~$0.9 million, respectively, and are included in accounts payable and accrued expenses on the accompanying condensed consolidated balance sheets.

Natural Habitat has a license agreement with WWF, which allows it to use the WWF name and logo. In return for these rights, Natural Habitat is charged a royalty fee and a fee based on annual gross sales. The fees are included within selling and marketing expense on the accompanying condensed consolidated statements of operations. This royalty fee expense was $0.2 million and ~~$0.3~~$0.4 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021,~~2022, respectively, and $0.0 million and $0.1 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021, ~~was $0.1 million and $0.1 million,~~ respectively.

From time to time, the Company enters into agreements to charter vessels onto which it holds its tours and expeditions. Future minimum payments on its charter agreements as of ~~September~~June 30, ~~2021~~2022 are as follows:

From time to time, the Company is party to litigation and regulatory matters and claims. The Company expenses legal fees as incurred. The Company records a provision for contingent losses when it is both probable that a liability will be incurred and the amount or range of the loss can be reasonably estimated. The results of complex proceedings and reviews are difficult to predict and the Company’s view of these matters ~~may~~ change in the future as events related thereto unfold. An unfavorable outcome to any legal or regulatory matter, if material, could have an adverse effect on the Company’s operations or its financial position, liquidity or results of operations.

The Company is primarily a specialty cruise and experiential travel operator with operations in 2 reportable segments, Lindblad and Land Experiences. The Company evaluates the performance of the business based largely on the results of its operating segments. The chief operating decision maker and management review operating results monthly, and base operating decisions on the total results at a consolidated level, as well as at a segment level. The reports provided to the Board of Directors are at a consolidated level and ~~also~~ contain information regarding the separate results of both segments.

The Company evaluates the performance of its business segments based largely on tour revenues and operating income, without allocating other income and expenses, net, income taxes and interest expense, net. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, operating results for the Company’s reportable segments were as follows:

Depreciation and amortization are included in segment operating income as shown below:

The following table presents our total assets, intangibles, net and goodwill by segment:

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 there was ~~$1.0~~$2.0 million and ~~$1.1~~$3.6 million, respectively, in intercompany tour revenues between the Lindblad and Land Experiences reportable segments, which were eliminated in consolidation. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, there ~~were $0.0 million and $2.2 million, respectively in~~was 0 intercompany tour revenues between the Lindblad and Land Experiences reportable ~~segments eliminated in consolidation.~~segments.

On ~~October 8, 2021,~~ the Company received $6.0 million, representing the remainder of its grant, under the US Treasury’s Coronavirus Economic Relief for Transportation Services (“CERTS”) Act. The CERTS Act, provided grants to eligible motorcoach, school bus, passenger vessel, and pilotage companies that have experienced annual revenue losses of 25 ~~percent or more as result of COVID-~~~~19.~~ ~~The priority use of grant funds must be for payroll costs, though grants~~ ~~may~~ ~~be used for operating expenses and the repayment of debt accrued to maintain payroll. The Company anticipates using the granted funds primarily for permitted payroll costs and ship operating expenses.~~

On ~~October 14, 2021,~~ to further expand its land-based experiential travel offerings, the Company acquired 80.1% of the outstanding ownership interests in Classic Journeys, LLC for $12.8 million in cash. Classic Journeys, LLC is a leading luxury walking tour company that offers highly curated active small-group and private custom journeys that are centered around cinematic walks led by expert local guides in over 50 ~~countries around the world.~~

The following discussion and analysis addresses material changes in the financial condition and results of operations of the Company for the periods presented. This discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q (“Form 10-Q”), as well as the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on ~~March 12, 2021.~~February 28, 2022.

Any statements in this Form 10-Q about our expectations, beliefs, plans, objectives, prospects, financial condition, assumptions or future events or performance are not historical facts and are “forward-looking statements” as that term is defined under the federal securities laws. These statements are often, but not always, made through the use of words or phrases such as “believe,” “anticipate,” “should,” “intend,” “plan,” “will,” “expects,” “estimates,” “projects,” “positioned,” “strategy,” “outlook” and similar words. You should read the statements that contain these types of words carefully. Such forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from what is expressed or implied in such forward-looking statements. There may be events in the future that we are not able to predict accurately or over which we have no control. Potential risks and uncertainties include, but are not limited to:

We urge you not to place undue reliance on these forward-looking statements, which speak only as of the date of this Form 10-Q. We do not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect events or uncertainties after the date hereof or to reflect the occurrence of unanticipated events.

Unless the context otherwise requires, in this Form 10-Q, “Company,” “Lindblad,” “we,” “us,” “our,” and “ours” refer to Lindblad Expeditions Holdings, Inc., and its subsidiaries.

We provide expedition cruising and land-based adventure travel fostering a spirit of exploration and ~~cycling touring experiences,~~discovery, using itineraries ~~that feature~~featuring up-close encounters with wildlife and nature, history and culture and promote guest empowerment, human connections and interactivity. Our mission is ~~offering~~to offer life-changing adventures around the world and pioneering innovative ways to allow our guests to connect with exotic and remote places.

We currently operate a fleet of ten owned expedition ships ~~having taken possession of our new polar ice class vessel, the~~ ~~National Geographic Resolution~~~~, in September 2021,~~ and ~~operate~~ five seasonal charter vessels under the Lindblad Expeditions, ~~Holdings, Inc.~~LLC (“Lindblad”) brand. ~~Additionally, during September 2021, we purchased~~Each expedition ship is fully equipped with state-of-the-art tools for in-depth exploration and the ~~Crystal Esprit yacht and expect~~majority of our expeditions involve travel to ~~begin operating it in 2022. Our~~remote places, such as voyages ~~include destinations such as~~to the Arctic, Antarctic, the Galápagos Islands, Alaska, ~~and Baja's~~Baja’s Sea of ~~Cortez.~~Cortez, the South Pacific, Costa Rica and Panama. We have a longstanding relationship with the National Geographic Society (“National Geographic”) dating back to 2004, which is based on a shared interest in exploration, research, technology and conservation. This relationship includes a co-selling, co-marketing and branding arrangement ~~with National Geographic Partners, LLC (“National Geographic”),~~ whereby our owned vessels carry the National Geographic name and National Geographic sells our expeditions through its internal travel division. We collaborate with National Geographic on voyage planning to enhance the guest experience by having National Geographic experts, including photographers, writers, marine biologists, naturalists, field researchers and film crews, join our expeditions. Guests ~~have the ability~~are able to interface with these experts through lectures, excursions, dining and other experiences throughout their voyage. We deploy chartered vessels for various seasonal offerings and continually seek to optimize our charter fleet to balance our inventory with demand and maximized yields. We use our charter inventory as a mechanism to both increase travel options of our existing and prospective guests and also to test demand for certain areas and seasons to understand the potential for longer term deployments and additional vessel needs.

We operate land-based nature adventure travel expeditions around the globe, with unique itineraries designed to offer intimate encounters with nature and the ~~planet's~~planet’s wild destinations and the animals and people who live there.

Natural Habitat, Inc. (“Natural Habitat”) ~~creates opportunities for adventure and discovery that transform lives with~~provides eco-conscious expeditions and nature-focused, small-group ~~tours~~experiences that include polar bear tours in Churchill, Canada, Alaskan grizzly bear adventures, small-group Galápagos Islands tours and African safaris. Natural Habitat has partnered with World Wildlife Fund (“WWF”) to offer conservation travel, which is sustainable travel that contributes to the protection of nature and wildlife.

DuVine Cycling + Adventure Company (“DuVine”) provides ~~international~~intimate cycling adventures and ~~unforgettable~~ travel experiences, led by expert guides, with a focus on connecting with local character and culture, ~~on small, intimate group cycling tours around the world with cycling experts as guides, immersion in~~including high-quality local cuisine ~~accommodations~~ and ~~history.~~accommodations. International cycling tours include the exotic Costa Rican rainforests, the rocky coasts of Ireland ~~deep in~~and the vineyards of Spain, ~~or high in the Swiss Alps. Cycling~~while cycling adventures in the United States ~~vary from~~include cycling beneath the California redwoods, to pedaling through Vermont farmland and wine tastings in the world-class vineyards of Napa and ~~Sonoma or farm-to-table renaissance dining.~~Sonoma.

Off the Beaten Path, LLC (“Off the Beaten Path”) provides small group travel, led by local, experienced guides, with distinct focus on wildlife, hiking national parks and ~~culture, to change people's lives through exceptional travel.~~culture. Off the Beaten Path ~~is known for providing distinctive~~offerings include insider national park experiences in the Rocky Mountains, Desert Southwest, and Alaska, ~~and includes~~as well as unique trips across Europe, Africa, Australia, Central and South America and the South ~~Pacific, for connecting~~Pacific.

Classic Journeys, LLC (“Classic Journeys”) offers highly curated active small-group and private custom journeys centered around cinematic walks led by expert local guides in over 50 countries around the ~~heart~~world. These walking tours are highlighted by luxury boutique accommodations and handcrafted itineraries that immerse guests into the history and culture of the ~~traveler with~~places they are exploring and the ~~soul of the place.~~people who live there.

We operate two segments including the Lindblad segment, which consists of the operations of our Lindblad brand, and the Land Experiences segment, consisting of our Natural Habitat, DuVine, ~~and~~ Off the Beaten Path ~~brands.~~

~~We resumed ship operations in June 2021~~ and as of November 2, 2021 had eight of our ten vessels providing expeditions to guests. During June 2021, we launched three ships in Alaska and another in the Galapagos and during the third quarter the Company resumed operations on the majority of its remaining vessels with additional ships operating in Alaska, the Galapagos, Iceland and the Pacific Northwest.

~~During September 2021, we drew down $46.2 million under the second export credit agreement in conjunction with our final payment upon delivery of the~~ ~~National Geographic Resolution~~~~. In April 2021 we drew down $15.5 million under the second export credit agreement in conjunction with our fourth installment payment for the vessel.~~ Classic Journeys brands.

During the first quarter of 2021, we completed the acquisitions of Off the Beaten Path, a land-based travel operator specializing in authentic national park experiences, and DuVine, an international luxury cycling and adventure company focused on exceptional food and wine experiences.2022 Highlights

During ~~September 2021,~~the second quarter 2022, all ten of our owned vessels were in operations, providing immersive expeditions to guests to Alaska, the Arctic, the Galápagos Islands, Iceland, Norway and the Baltic and North Seas.

During May 2022, we ~~acquired~~amended our senior secured credit agreements to, among other things, extend the ~~Crystal Esprit yacht~~waiver of the net leverage ratio covenant through December 31, 2022.

During February 2022, we issued $360.0 million of 6.75% senior secured notes due 2027 and entered into a new $45.0 million revolving credit facility, which remains undrawn and matures February 2027. We used the proceeds from the notes to prepay in full all outstanding borrowings under our prior term loan, including the Main Street Loan, and revolving credit facility, and paid all related premiums, terminating in full our existing credit agreement and the commitments thereunder.

During February 2022, our cupos necessary for ~~$13.3 million. We expect to modify the vessel to a capacity of 48 guest, along with other changes, and replace the~~ ~~National Geographic Islander~~tours in the ~~Galapagos.~~Galápagos Islands were contractually renewed for a 20-year period.

~~We resumed ship~~During the second quarter of 2022, we continued to ramp up our operations, ~~in June 2021 and, as of November 2, 2021, had eight of our ten operating vessels~~ providing expeditions to ~~guests. During June 2021,~~guests on all ten owned vessels, including trips to Alaska, the Arctic, the Galápagos Islands, Iceland, Norway and the Baltic and North Seas. Due to the spread of the COVID-19 virus and the effects of travel restrictions around the world, we ~~launched three ships in Alaska and another in the Galapagos, and during the third quarter, we resumed operations on~~suspended or rescheduled the majority of our ~~remaining vessels with additional ships operating in Alaska, the Galapagos, Iceland~~expeditions departing between March 16, 2020 through May 31, 2021. Travel restrictions related to COVID-19 have diminished dramatically and ~~the Pacific Northwest. We~~we continue to work with local authorities on plans to operate itineraries in additional geographies during ~~remainder~~the second half of ~~the year~~2022 and in ~~early 2022. As the COVID-19 virus effects~~2023. Where travel restrictions ~~in various locations around~~remain, which now also includes a limited number of itineraries impacted by the ~~world,~~Russia-Ukraine conflict, we ~~also continue to work~~are adjusting itineraries where possible, and working with ~~our~~ guests to reschedule travel plans and refund payments or issue future travel certificates, as ~~applicable, for those expeditions and trips that we are not able to operate due to local restrictions.~~applicable.

We believe there are a variety of strategic advantages that enable us to deploy our ships safely and quickly, while mitigating the risk of COVID-19 as travel restrictions are lifted. The most notable is the size of our owned and operated vessels which range from 48 to 148 passengers, allowing for a highly controlled environment that includes stringent cleaning protocols. The small nature of our ships also allows us to efficiently and effectively test our guests and crew prior to ~~boarding.~~boarding, or as otherwise needed. Additionally, all guests age 12five and older, crew and staff are required to be fully vaccinated and the majority of expeditions take place in remote locations where human interactions are limited, so there is less opportunity for external influence.

While our ships were not in operations, the majority of the fleet was being maintained with minimally required crew on-board to ensure they complied with all necessary regulations and could be fully put back into service quickly as needed. Ahead of launching each ship, crew levels were increased as necessary to prepare each vessel for operations as well as for crew training and vaccinations. Our offices primarily remain closed, and most employees are working remotely to maintain general business operations, to provide assistance to existing and potential guests and to maintain information technology systems.

We continue to adhere to the comprehensive plan we implemented in March 2020 to mitigate the impact of COVID-19 and preserve and enhance our liquidity position. Prior to resuming operations, this plan employed a variety of cost reduction and cash preservation measures including significantly reducing ship and land-based expedition costs such as capital expenditures, crew payroll, land costs, fuel and food, and meaningfully reducing general and administrative expenses through reduced payroll and the elimination of all non-essential travel, office expenses and discretionary spending. We also accessed available capital under existing debt facilities and through the issuance of preferred stock. With the majority of operations resuming, operating costs are ramping back up, but given the continued uncertainty around COVID-19 and given that guest counts have not yet returned to traditional levels, we continue to minimize expenditures as appropriate.

We have ~~experienced a~~ substantial ~~negative~~advanced reservations for future travel despite some continued impact from the COVID-19 virus, including, but not limited to, elevated cancellations and softness in near-term ~~demand. Despite~~demand, as well as some impact related to itinerary changes due to the ~~COVID-19 impact, we continue to see significant new bookings across the fleet and have substantial advanced reservations for future travel.~~Russia-Ukraine conflict. Bookings for ~~the full year 2022~~2023 are ~~51%~~26% ahead of the bookings for ~~2021 as of~~the full year 2020 at the same ~~date a year ago and 25% ahead of~~point in 2019, which was prior to the ~~bookings for 2020 as of the same date two years ago.~~

~~For voyages that were cancelled or rescheduled, we offered guests future travel credits or full refunds and the majority of guests opted for future travel credits.~~ pandemic.

As of ~~September~~June 30, ~~2021,~~2022, we had ~~$155.6~~$126.9 million in unrestricted cash and ~~$29.5~~$48.8 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves. During August 2021, we received a $21.0 million grant under the Coronavirus Economic Relief for Transportation Services (“CERTS”) Act, which provided grants to eligible motorcoach, school bus, passenger vessel and pilotage companies that have experienced annual revenue losses of 25 percent or more as result of COVID-19. The priority use of grant funds must be for payroll costs, though grants may also be used for permitted operating expenses and the repayment of debt accrued to maintain payroll.

~~As of September 30, 2021, we had a~~Our total debt position ~~of $561.8~~was $578.2 million, and we were in compliance with all of our debt covenants currently in effect.

~~In conjunction with the continuing economic risk of the COVID-19 pandemic, during 2021 we have taken a variety of steps to strengthen our balance sheet and increase liquidity including:~~

During June 2021, we further amended our export credit facilities to, among other things, extend the deferral of scheduled amortization payments of the first export credit facility through December 2021 in the aggregate amount of $15.7 million, extend the effective suspension of the total net leverage ratio covenant through March 2022, increase the interest rate for the export credit facilities by 50 basis points and annualize EBITDA used in the covenant calculation through December 31, 2022. The deferred principal payments will amortize quarterly over three years starting in March 2022. Certain other covenants continue to be more restrictive during the extended covenant waiver period.

During April 2021, we further amended our term loan and revolving credit agreement to, among other things, extend the waiver of its total net leverage ratio covenant through March 31, 2022, annualized EBITDA used in our covenant calculation through December 31, 2022 and increase the interest rate spreads of the Term Facility, excluding the Main Street Loan, and the Revolving Facility by 50 basis points, such additional interest to be paid in cash. Certain other covenants continue to be more restrictive during the extended covenant waiver period.

As we continue to ramp up operations, our monthly cash usage will increase as we incur costs in operating expeditions, ~~preparing additional ships for return to service,~~including the impact of higher fuel costs and inflation, and spending to market and advertise upcoming expeditions and trips. We also anticipate a significant increase in guest payments as we receive final payments for upcoming expeditions as well as deposits for new reservations for future travel. However, there can be no assurance that cash flows from operations will be available to fund future obligations or that we will not experience delays or cancellations with respect to the resumption of our operations.

The discussion and analysis of our results of operations and financial condition are organized as follows:

Selling and marketing expenses include commissions, royalties and a broad range of advertising and promotional expenses.

General and administrative expenses include the cost of shoreside vessel support, reservations and other administrative functions, including salaries and related benefits, credit card commissions, professional fees and rent.

We use a variety of operational and financial metrics, including non-GAAP financial measures, such as Adjusted EBITDA, Net Yields, Occupancy and Net Cruise Costs, to enable us to analyze our performance and financial condition. We utilize these financial measures to manage our business on a day-to-day basis and believe that they are the most relevant measures of performance. Some of these measures are commonly used in the cruise and tourism industry to evaluate performance. We believe these non-GAAP measures provide expanded insight to assess revenue and cost performance, in addition to the standard GAAP-based financial measures. There are no specific rules or regulations for determining non-GAAP measures, and as such, they may not be comparable to measures used by other companies within the industry.

The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. You should read this discussion and analysis of our financial condition and results of operations together with the condensed consolidated financial statements and the related notes thereto also included within.

Adjusted EBITDA is net income (loss) excluding depreciation and amortization, net interest expense, other income (expense), income tax (expense) benefit, (gain) loss on foreign currency, (gain) loss on transfer of assets, reorganization costs, and other supplemental adjustments. Other supplemental adjustments include certain non-operating items such as stock-based compensation, executive severance costs, the National Geographic fee amortization, debt refinancing costs, acquisition-related expenses and other non-recurring charges. We believe Adjusted EBITDA, when considered along with other performance measures, is a useful measure as it reflects certain operating drivers of the business, such as sales growth, operating costs, selling and administrative expense, and other operating income and expense. We believe Adjusted EBITDA helps provide a more complete understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not take into account certain requirements, such as unearned passenger revenues, capital expenditures and related depreciation, principal and interest payments, and tax payments. Our use of Adjusted EBITDA may not be comparable to other companies within the industry.

Adjusted Net Cruise Cost represents Net Cruise Cost adjusted for ~~Non-GAAP~~non-GAAP other supplemental adjustments which include certain non-operating items such as stock-based compensation, the National Geographic fee amortization, and acquisition-related expenses.

Available Guest Nights is a measurement of capacity and represents double occupancy per cabin (except single occupancy for a single capacity cabin) multiplied by the number of cruise days for the period. We also record the number of guest nights available on our limited land programs in this definition.

Gross Cruise Cost represents the sum of cost of tours plus, selling and marketing expenses, and general and administrative expenses.

Gross Yield per Available Guest Night represents tour revenues less insurance proceeds divided by Available Guest Nights.

Guest Nights Sold represents the number of guests carried for the period multiplied by the number of nights sailed within the period.

Maximum Guests is a measure of capacity and represents the maximum number of guests in a period and is based on double occupancy per cabin (except single occupancy for a single capacity cabin).

Net Cruise Cost represents Gross Cruise Cost excluding commissions and certain other direct costs of guest ticket revenues and other tour revenues.

Net Cruise Cost Excluding Fuel represents Net Cruise Cost excluding fuel costs.

Net Yield represents tour revenues less insurance proceeds, commissions and direct costs of other tour revenues.

Net Yield per Available Guest Night represents Net Yield divided by Available Guest Nights.

Number of Guests represents the number of guests that travel with us in a period.

Occupancy is calculated by dividing Guest Nights Sold by Available Guest Nights.

Voyages represent the number of ship expeditions completed during the period.

The U.S. dollar is the functional currency in our foreign operations and re-measurement adjustments and gains or losses resulting from foreign currency transactions are recorded as foreign exchange gains or losses in the condensed consolidated statements of operations.

Traditionally, our Lindblad brand tour revenues ~~from the sale of guest tickets~~ are mildly seasonal, historically larger in the first and third quarters. The seasonality of our operating results fluctuates due to our vessels being taken out of service for scheduled maintenance or drydocking, which is typically during nonpeak demand periods, in the second and fourth quarters. Our drydock schedules are subject to cost and timing differences from ~~year to year~~year-to-year due to the availability of shipyards for certain work, drydock locations based on ship itineraries, operating conditions experienced especially in the polar regions and the applicable regulations of class societies in the maritime industry, which require more extensive reviews periodically. Drydocking impacts operating results by reducing tour revenues and increasing cost of tours. Our Natural Habitat, DuVine, ~~and~~ Off the Beaten Path and Classic Journeys brands are seasonal businesses, with the majority of Natural Habitat’s tour revenue recorded in the third and fourth quarters from its summer season departures and polar bear tours, while the majority of Off the Beaten Path, DuVine and ~~DuVine’s~~Classic Journeys’ revenues are recorded during the second and third quarters from their spring and summer season ~~tours and cycling adventures.~~departures.

Comparison of the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 to Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2020 -~~2021 — Consolidated

Tour revenues for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$63.5~~$75.6 million, to ~~$64.5~~$90.9 million, compared to ~~$1.0~~$15.3 million for the three months ended ~~September~~June 30, ~~2020.~~2021. The Lindblad segment tour revenues increased by ~~$33.1~~$57.3 million, and the Land Experiences segment increased ~~$30.4~~$18.3 million, primarily ~~as a result~~due to the ramp of ~~restarting~~ expeditions and trips. The Land Experiences segment also includes the results for Classic Journeys for 2022, which was acquired in the fourth quarter of 2021.

Tour revenues for the six months ended June 30, 2022 increased $141.7 million, to $158.7 million, compared to $17.0 million for the six months ended June 30, 2021. The Lindblad segment tour revenues increased by $107.1 million, and the Land Experiences segment increased $34.6 million, primarily due to the ramp of expeditions and trips. For 2022, the Land Experiences segment also includes results for the full year-to-date period for Off the Beaten Path and DuVine, which were acquired in the first quarter of 2021, and the results for Classic Journeys, which was acquired during the ~~first~~fourth quarter of 2021.

Tour revenues for the nine months ended September 30, 2021 decreased $0.4 million to $81.6 million, compared to $82.0 million for the nine months ended September 30, 2020. The Lindblad segment tour revenues decreased by $29.3 million, primarily as a result of cancelled, disrupted and rescheduled expeditions due to COVID-19. At the Land Experiences segment, tour revenues increased $28.8 million over the prior year period, primarily due to operating additional trips and from the inclusion of the results of Off the Beaten Path and DuVine, which were acquired during the first quarter of 2021.

Total cost of tours for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$37.5~~$43.1 million, to ~~$45.6~~$62.5 million, compared to ~~$8.1~~$19.4 million for the three months ended ~~September~~June 30, ~~2020. At the~~2021. The Lindblad segment cost of tours increased ~~$18.3~~by $31.5 million, and the Land Experiences segment increased $11.6 million, primarily due to the ~~restart~~ramp of ~~expeditions. At~~expeditions and trips. The Land Experiences segment also includes the ~~Land Experiences~~results for Classic Journeys for 2022, which was acquired in the fourth quarter of 2021.

Total cost of tours for the six months ended June 30, 2022 increased $92.7 million, to $120.4 million, compared to $27.7 million for the six months ended June 30, 2021. The Lindblad segment cost of tours increased ~~$19.2~~by $71.4 million, and the Land Experiences segment increased $21.3 million, primarily due to ~~operating additional trips during~~ the ~~third quarter~~ramp of ~~2021~~expeditions and trips. The Land Experiences segment also includes results for the ~~inclusion of the results of~~full year-to-date period for Off the Beaten Path and DuVine, which were acquired ~~during~~in the first quarter of ~~2021.~~

~~Total cost of tours for the nine months ended September 30,~~ 2021, increased $10.3 million, or 16%, to $73.3 million, compared to $63.0 million for the nine months ended September 30, 2020. At the Lindblad segment, cost of tours decreased $6.9 million, primarily related to cancelled, disrupted and rescheduled expeditions due to COVID-19. At the Land Experiences segment, cost of tours increased $17.2 million, primarily due to operating additional trips and the ~~inclusion of~~results for Classic Journeys, which was acquired in the ~~results of Off the Beaten Path and DuVine, which were acquired during the first~~fourth quarter of 2021.

General and administrative expenses for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$7.9~~$8.4 million, or ~~86%~~55%, to ~~$17.0~~$23.7 million, compared to ~~$9.1~~$15.3 million for the three months ended ~~September~~June 30, ~~2020.~~2021. At the Lindblad segment, general and administrative expenses increased ~~$4.5~~$4.9 million from the prior year period, primarily due to higher personnel costs associated with ~~restarting~~the ramp in operations, increased stock-based compensation expense and higher credit card commissions due to the strong booking environment. At the Land Experiences segment, general and administrative expenses increased ~~$3.4~~$3.5 million, primarily due to increased personnel costs related to operating additional trips, higher credit card commissions due to the strong booking environment and the inclusion of results for Classic Journeys, which was acquired in the ~~results of Off the Beaten Path and DuVine, which were acquired during the first~~fourth quarter of 2021.

General and administrative expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 increased ~~$9.9~~$15.2 million, or ~~28%~~52%, to ~~$46.1~~$44.3 million, compared to ~~$36.2~~$29.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021. At the Lindblad segment, general and administrative expenses increased ~~$4.7~~$9.5 million from the prior year period, primarily due to higher personnel costs associated with ~~restarting~~the ramp in operations, ~~increased stock-based compensation expense and~~ increased credit card commissions due to athe strong booking ~~environment.~~environment and higher stock-based compensation expense. At the Land Experiences segment, general and administrative expenses increased ~~$5.2~~$5.7 million, primarily due to increased personnel costs related to operating additional trips, higher credit card commissions due to athe strong booking environment and the ~~impact~~inclusion of results for the ~~acquisitions of~~full year-to-date period for Off the Beaten Path and DuVine, which were ~~completed during~~acquired in the first quarter of 2021, and the results for Classic Journeys, which was acquired in the fourth quarter of 2021.

Selling and marketing expenses for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$8.1~~$7.8 million to ~~$10.2~~$12.8 million, compared to ~~$2.1~~$5.0 million for the three months ended ~~September~~June 30, ~~2020.~~2021. At the Lindblad segment, selling and marketing expenses increased ~~$6.7~~$7.1 million, primarily due to higher commissions related to the ramp in operations and increased advertising ~~spend.~~spend to drive future growth. At the Land Experiences segment, selling and marketing expenses increased ~~$1.4~~$0.7 million, primarily due to increased marketing spend ~~and higher commissions~~ associated with the ramp up in operations and the inclusion of results for Classic Journeys, which was acquired in the ~~results of Off the Beaten Path and DuVine which were acquired during the first~~fourth quarter of 2021.

Selling and marketing expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2021 decreased $0.7~~2022 increased $17.7 million ~~or 4%,~~ to ~~$17.7~~$25.2 million, compared to ~~$18.4~~$7.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021. At the Lindblad segment, selling and

marketing expenses ~~decreased $3.2~~increased $15.7 million, primarily due to ~~lower commission expenses due to the cancellation, disruption and rescheduling of expeditions due to COVID-19 partially offset by increased marketing spend~~higher commissions related to the ramp up in ~~operations.~~operations and increased advertising spend to drive future growth. At the Land Experiences segment, selling and marketing expenses increased ~~$2.5~~$2.0 million, primarily due to increased marketing spend ~~and higher commissions~~ associated with the ramp up in operations, and includes results for the ~~inclusion of the results of~~full year-to-date period for Off the Beaten Path and DuVine, which were acquired ~~during~~in the first quarter of 2021, and the results for Classic Journeys, which was acquired in the fourth quarter of 2021.

Depreciation and amortization expenses for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$0.8~~$3.0 million, or ~~10%~~36%, to ~~$9.3~~$11.2 million, compared to ~~$8.5~~$8.2 million for the three months ended ~~September~~June 30, ~~2020,~~2021, primarily due to ~~information~~depreciation for the National Geographic Resolution placed into service in September 2021, depreciation of technology assets placed into service to support our digital initiatives, accelerated depreciation for the National Geographic Islander, which will be replaced later in 2022, and the amortization of acquired intangibles.

Depreciation and amortization expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 increased ~~$2.1~~$5.9 million, or 9%36%, to ~~$25.8~~$22.4 million, compared to ~~$23.7~~$16.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, primarily due to ~~a full nine months of~~ depreciation offor the National Geographic ~~Endurance~~Resolution placed into service in September 2021, depreciation of technology assets placed into service to support our digital initiatives, accelerated depreciation for the National Geographic Islander, which ~~was added to~~will be replaced later in 2022, and the ~~fleet in March 2020.~~amortization of acquired intangibles.

Other expenses for the three months ended ~~September~~June 30, ~~2021, decreased $0.5~~2022, increased $4.7 million to ~~$3.1~~$10.2 million from ~~$3.6~~$5.5 million for the three months ended ~~September~~June 30, ~~2020,~~2021, primarily due to the following:

Other expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2021, decreased $4.1~~2022, increased $7.2 million to ~~$14.2~~$18.3 million from ~~$18.3~~$11.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, primarily due to the following:

Selected information for our reportable segments is below. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

~~The following table sets forth our Available Guest Nights, Guest Nights Sold, Occupancy, Maximum Guests, Number of Guests and Voyages for the three and nine months ended September 30, 2021 and 2020:~~

The following table shows the calculations of Gross Yield and Net Yield for the three and nine months ended September 30, 2021 and 2020. Gross Yield is calculated by dividing Tour Revenues by Available Guest Nights and Net Yield is calculated by dividing Net Revenue by Available Guest Nights:

~~The following table reconciles operating income to our Net Yield Guest Metric for the Lindblad Segment:~~

~~The following table shows the calculations of Gross Cruise Cost and Net Cruise Costs for the three and nine months ended September 30, 2021 and 2020:~~

Comparison of Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 to Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2020~~2021 at the Lindblad Segment

Tour revenues for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$33.1~~$57.3 million to ~~$33.1 million.~~$64.0 million, compared to $6.7 million for the three months ended June 30, 2021. The increase in 2022 was a result of ~~restarting~~the ramp in expeditions ~~during 2021~~ compared with ~~cancelling, disrupting and rescheduling all expeditions due to COVID-19 in~~ the ~~third~~second quarter of ~~2020.~~2021.

Tour revenues for the ~~nine~~six months ended ~~September~~June 30, ~~2021 decreased $29.3~~2022 increased $107.1 million to ~~$40.3~~$114.3 million, compared to ~~$69.5~~$7.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020.~~2021. The ~~decrease~~increase in 2022 was ~~primarily driven by additional cancelled, disrupted and rescheduled~~a result of the ramp in expeditions ~~due to COVID-19 during~~compared with the six months ended June 30, 2021.

Operating loss ~~decreased $2.6~~for the three months ended June 30, 2022 improved by $11.3 million to a loss of ~~$22.3~~$19.7 million compared to a loss of $31.0 million for the three months ended ~~September~~June 30, 2021, compared to an operating loss of $24.8 million for the three months ended September 30, 2020. The decrease was a result of restarting expeditions during 2021 compared with cancelling, disrupting and rescheduling all expeditionsprimarily due to ~~COVID-19 during~~ the ~~third quarter~~increase in tour revenues, partially offset by higher cost of ~~2020.~~tours and personnel costs due to the ramp in operations, increased commissions related to the revenue and bookings growth, higher marketing costs to drive future growth and increased depreciation mainly from the delivery of the National Geographic Resolution.

Operating loss ~~increased $26.3~~for the six months ended June 30, 2022 improved $5.1 million to a loss of ~~$80.6~~$53.2 million ~~for the nine months ended September 30, 2021,~~ compared to a loss of ~~$54.3~~$58.3 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020. The increase was~~2021, primarily ~~driven by lower revenue from cancelled, disrupted and rescheduled voyages~~ due to ~~COVID-19.~~the increase in tour revenues, partially offset by higher cost of tours and personnel costs due to the ramp in operations, increased commissions related to the revenue and bookings growth, higher marketing costs to drive future growth and increased depreciation mainly from the delivery of the National Geographic Resolution.

~~Results~~Comparison of ~~Operations~~ – Three and Six Months Ended June 30, 2022 to Three and Six Months Ended June 30, 2021 at the Land Experiences Segment

~~Comparison of Three and Nine Months Ended September 30, 2021 to Three and Nine Months Ended September 30, 2020~~

Tour revenues for the three months ended ~~September~~June 30, ~~2021~~2022 increased ~~$30.4~~$18.3 million to ~~$31.4~~$26.9 million compared to ~~$1.0~~$8.6 million for the three months ended ~~September~~June 30, ~~2020,~~2021, primarily as a result of operating additional trips during the ~~third~~second quarter 2022 and the inclusion of results for Classic Journeys in 2022, which was acquired in the fourth quarter of 2021.

Tour revenues for the six months ended June 30, 2022 increased $34.6 million to $44.5 million compared to $9.9 million for the six months ended June 30, 2021, primarily as a result of operating additional trips during 2022 and the inclusion of the full year-to-date period of results offor Off the Beaten Path and DuVine, which were acquired ~~during~~in the first quarter of ~~2021.~~

~~Tour revenues~~2021, and the results for Classic Journeys, which was acquired in the nine months ended September 30, 2021 increased $28.8 million to $41.3 million compared to $12.5 million for the nine months ended September 30, 2020, due primarily to operating additional trips beginning the second quarter of 2021, the cancelled, disrupted and rescheduled expeditions due to COVID-19 during 2020, and by the inclusion of the operations of Off the Beaten Path and DuVine, which were acquired during the firstfourth quarter of 2021.

Operating income ~~increased $6.6 million to $4.6~~of $0.4 million for the three months ended ~~September~~June 30, ~~2021,~~2022, improved $1.9 million compared to an operating loss of ~~$2.0~~$1.5 million for the three months ended ~~September~~June 30, ~~2020.~~2021, primarily a result of operating additional trips during the second quarter of 2022.

Operating loss for the six months ended June 30, 2022 improved by $5.0 million to a loss of $0.3 million, compared to a loss of $5.3 million for the six months ended June 30, 2021. The ~~higher~~lower operating ~~income~~loss was primarily a result of operating additional trips during 2022 and the ~~third quarter~~inclusion of ~~2021. The third quarter~~the full year-to-date period of ~~2021 also included the~~ results offor Off the Beaten Path and DuVine, which were acquired ~~during the first quarter of 2021.~~

Operating loss for the nine months ended September 30, 2021 decreased $4.3 million to a loss of $0.7 million compared to a loss of $5.0 million for the nine months ended September 30, 2020. The decrease was primarily a result of operating additional trips and from the inclusion of the results of Off the Beaten Path and DuVine which were acquired duringin the first quarter of 2021.

The following table outlines the reconciliation of net loss to consolidated Adjusted EBITDA for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

The following tables outline the reconciliation for each reportable segment from operating income to Adjusted EBITDA for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021.

The following table sets forth our Available Guest Nights, Guest Nights Sold, Occupancy, Maximum Guests, Number of Guests and Voyages for the three and six months ended June 30, 2022 and 2021:

The following table shows the calculations of Gross and Net Yield for the three and six months ended June 30, 2022 and 2021. Gross Yield is calculated by dividing Tour Revenues by Available Guest Nights and Net Yield is calculated by dividing Net Revenue by Available Guest Nights:

The following table reconciles operating income to our Net Yield Guest Metric for the Lindblad Segment:

The following table shows the calculations of Gross and Net Cruise Costs for the three and six months ended June 30, 2022 and 2021:

The COVID-19 pandemic has had a material negative impact on our operations and financial results and, while we have substantially resumed operations, given the dynamic nature of this situation, we cannot reasonably estimate the impacts of the COVID-19 pandemic on our financial condition, results of operations, cash flows, plans and growth for the foreseeable future. ~~It is unknown when travel restrictions and various border closures will be completely lifted and what the demand for expedition travel will be once these restrictions are no longer in place.~~

During August 2021, we received a $21.0 million grant under the CERTS Act, which provided grants to eligible motorcoach, school bus, passenger vessel, and pilotage companies, see the notes to the condensed consolidated financial statements for more information.

As of ~~September~~June 30, ~~2021,~~2022, we had approximately ~~$561.8~~$578.2 million in long-term debt obligations, including the current portion of long-term debt. We believe that our cash on hand and expected future operating cash inflows will be sufficient to fund operations, debt service requirements and necessary capital expenditures, assuming that our operations continue to ramp up as we currently expect.

As we continue to ramp up operations, our monthly cash usage will continue to increase as we incur costs in operating additional expeditions ~~preparing additional ships for return to service,~~ and trips and increase spending to market and advertise upcoming expeditions and trips. We also anticipate a significant increase in guest payments as we receive final payments for upcoming expeditions and trips, as well as deposits for new reservations for future travel. However, there can be no assurance that cash flows from operations will be available to fund future obligations or that we will not experience delays or cancellations with respect to the resumption of our operations.

Sources and Uses of Cash for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021

Net cash provided by operating activities was ~~$21.5~~$18.6 million ~~in 2021~~for the six months ended June 30, 2022 compared to ~~net cash used~~$21.8 million for the same period in ~~operating activities of $71.7~~2021. The $3.2 million ~~in 2020. The $93.3 million increase~~decrease is primarily due to ~~cash received from guests for final payments and deposits on upcoming expeditions and trips, partially offset by~~higher costs ofduring 2022 as we ramped operations. ~~The current period also included $21.0 million received for the CERTS grant.~~

Net cash used in investing activities was ~~$96.3~~$23.6 million six months ended June 30, 2022 compared to $32.4 million in the same period in 2021. 2021 ~~compared to $152.8 million in 2020. The $56.5 million decrease was~~ primarily ~~due to payments for the completion of the~~ ~~National Geographic Endurance~~ ~~during the first quarter 2020, partially offset during 2021 by~~included costs associated with building the National Geographic Resolution~~, the purchase of the Crystal Esprit~~ and ~~the net cash used for~~ the acquisitions of Off the Beaten Path and DuVine. 2022 primarily included routine vessel maintenance across the fleet and renovations to the National Geographic Islander II ahead of its launch later this year.

Net cash provided by financing activities was ~~$55.3~~$7.9 million ~~in 2021~~six months ended June 30, 2022 compared to ~~$261.4~~$9.6 million for the same period in ~~2020. The $206.2 million decrease is~~2021. 2022 primarily ~~due~~included the issuance of new senior secured notes which were used to repay the ~~borrowing $107.7~~prior credit agreement, including the term facility, the Main Street Loan and the revolving facility. 2021 mainly included the drawdown of $15.5 million under ~~the~~a senior secured credit agreement for ~~the final~~a contracted payment of the National Geographic ~~Endurance~~Resolution., a $45.0 million drawdown of our revolving credit facility, the $85.0 million generated from the issuance of Preferred Stock and the borrowing of $30.6 million under the senior secured credit agreement for an installment payment on the ~~National Geographic Resolution~~ ~~during 2020, partially offset by the borrowing of $61.7 million under the senior secured credit agreement for remaining payments on the~~ ~~National Geographic Resolution~~.

~~Our Third Amended and Restated Credit Agreement (the “Amended Credit Agreement”), provides a $200.0~~On February 4, 2022, we issued $360.0 million aggregate principal amount of 6.75% senior secured ~~first lien~~notes due 2027 (the “Notes”) in a private offering. The Notes bear interest at a rate of 6.75% per year, accruing from February 4, 2022, and interest on the Notes is payable semiannually in arrears on February 15 and August 15 of each year, beginning on August 15, 2022. The Notes will mature on February 15, 2027, subject to earlier repurchase or redemption. We used the net proceeds from the offering to prepay in full all outstanding borrowings under our prior credit agreement, including the term ~~loan~~ facility, ~~(the “Term Facility”), maturing March 2025,~~Main Street Loan, and revolving credit facility, to pay any related premiums and to terminate in full our prior credit agreement and the commitments thereunder. The Notes are senior secured obligations and are guaranteed on a ~~$45.0 million~~senior secured basis by us and certain of our subsidiaries (collectively, the “Guarantors”) and secured by first-priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all of our and the Guarantors’ assets. We may redeem the Notes at set redemption prices and premiums, plus accrued and unpaid interest, if any.

The Notes contain covenants that, among other things, restrict our ability and the ability of our restricted subsidiaries to incur certain additional indebtedness and make certain dividend payments, distributions, investments and other restricted payments. These covenants are subject to a number of important exceptions and qualifications set forth in the Notes.

On February 4, 2022, we entered into a new senior secured revolving credit facility (the ~~“Revolving~~“New Revolving Credit Facility”), which ~~includes~~provides for an aggregate principal amount of commitments of $45.0 million, maturing February 2027, including a ~~$5.0 million~~ letter of credit ~~sub-facility. In March 2020, we drew $45.0 million~~sub-facility in an aggregate principal amount of up to $5.0 million. The obligations under the New Revolving Credit Facility are guaranteed by us and the Guarantors and are secured by first-priority pari passu liens, subject to permitted liens and certain exceptions, on ~~our Revolving Facility, which matures in March 2023.~~

~~The Amended Credit Agreement was amended in August 2020 to waive~~substantially all the ~~application~~assets of the ~~total net leverage ratio covenant through June 2021. In connection with~~Company and the amendment, the interest rate of the Term Facility was increased 125 basis points, to be paid-in-kind at maturity, a LIBOR minimum of 0.75% was added to the Term Facility and certain covenants were amended to be more restrictive.

~~In December 2020, we amended the Amended Credit Agreement to provide for the borrowing of a new tranche of incremental term loans~~Guarantors. Borrowings under the ~~Amended~~New Revolving Credit ~~Agreement in an amount of $85.0 million, maturing December 2025, made under the Main Street Expanded Loan~~ Facility, (the “Main Street Loan”). Interest on the Main Street Loan shall be paid-in-kind for the first year and the principal shall amortize at a rate of 15% in each of the third and fourth years, with the remaining amounts to be paid at maturity.

During April 2021, we further amended our Amended Credit Agreement that, among other things, extends the waiver of the total net leverage ratio covenant through March 31, 2022, annualized EBITDA used in the covenant calculation through December 31, 2022 and increases the interest rate spreads of the Term Facility, excluding the Main Street Loan, and the Revolving Facility by 50 basis points. Certain other covenants under the Amended Credit Agreement continue to be more restrictive during the extended covenant waiver period.

The Term Facility (excluding the Main Street Loan), as amended, as of September 30, 2021, bears interest at an adjusted Intercontinental Exchange (“ICE”) Benchmark administration LIBOR, with a minimum of 0.75%, plus a spread of 5.25%, for an aggregated rate of 6.00% as of September 30, 2021, and the Revolving Facility bears interest at an adjusted ICE Benchmark administration LIBOR plus a spread of 3.50%, for an aggregated rate of 3.58% as of September 30, 2021. The Main Street Loan bearsif any, will bear interest at a rate per annum ofequal to, at our option, an adjusted ~~ICE Benchmark administration LIBOR for an interest period of 3-months~~SOFR rate plus ~~3.00%, for an aggregated~~a spread or a base rate ~~of 3.13% as of September 30, 2021.~~plus a spread.

~~In 2018, we entered into interest rate cap agreements to hedge our exposure to interest rate movements~~The New Revolving Credit Facility contains customary affirmative and ~~manage our interest rate expense related to the Term Facility.~~negative covenants, as well as financial covenants and event of default provisions.

Our first senior secured credit agreement (the “First Export Credit Agreement”) made available a loan ~~in an aggregate principal amount not to exceed $107.7 million~~ for the purpose of providing financing for up to 80% of the purchase price of our new polar ice class vessel, the National Geographic Endurance. During March 2020, we borrowed ~~the~~ $107.7 million under the First Export Credit Agreement for the final contracted payment of the National Geographic Endurance.

Our second senior secured credit agreement (the “Second Export Credit Agreement”) made available ~~to us~~ a loan ~~in an aggregate principal amount not to exceed $122.8 million~~ for the purpose of providing pre- and post-delivery financing for up to 80% of the purchase price of the National Geographic ~~Resolution~~Resolution.~~, which was delivered during September 2021. As of September 30, 2021, we~~ We borrowed ~~the~~ $122.8 million ~~available~~ under the Second Export Credit Agreement, drawing approximately $30.5 million in 2019, $30.6 million in 2020 and $61.7 million in 2021, with the ship delivered in September 2021.

In June ~~2020, we amended our export credit agreements to defer scheduled amortization payments from June 2020 to March 2021 and suspend the total net leverage ratio covenant through June 2021. During June~~ 2021, we ~~further~~ amended our export credit agreements to, among other things, ~~extend~~annualize EBITDA used in the ~~deferral of scheduled amortization payments of the First Export Credit Agreement~~covenant calculations through December ~~2021 in the aggregate amount of $15.7 million,~~31, 2022. During May 2022, we amended our export credit agreements to extend the waiver of the total net leverage ratio covenant

through ~~March 31, 2022, increase interest rate spreads of the export credit agreements by 50 basis points and annualize EBITDA used in the covenant calculation through~~ December 31, ~~2022. The deferred principal payments will amortize quarterly over three years starting March~~ 2022. Certain other covenants continue to be more restrictive during the extended covenant waiver period. We were in compliance with our covenants in effect as of ~~September~~June 30, ~~2021.~~2022 and are expected to be in compliance for the next 12 months.

The First Export Credit Agreement, as amended, bears interest at a ~~floating~~variable interest rate equal to three-month LIBOR plus a spread of 3.50% per annum, or ~~3.62%~~5.22% over the borrowing period covering ~~September~~June 30, ~~2021.~~2022. The Second Export Credit Agreement, as amended, bears a variable interest rate equal to three-month LIBOR plus a spread of 3.50% per annum, or ~~3.63%~~5.56% over the borrowing period covering ~~September~~June 30, ~~2021.~~2022.

In connection with the Natural Habitat acquisition in May 2016, Natural Habitat issued a $2.5 million unsecured promissory note, amended in May 2020, to Benjamin L. Bressler, the founder of Natural Habitat, with an outstanding principal amount of $0.8 million as of June 30, 2022. The promissory note accrues interest at a rate of 1.44% annually, with interest payable every six months and the remaining principal payment due on December 22, 2022.

Our Off the Beaten Path subsidiary has a loan maturing June 2023 for the purchase of guest transportation vehicles. The loan’s original principal was $0.3 million, is collateralized by the vehicles and bears an annual interest rate of 4.77%.

Our Off the Beaten Path subsidiary has a $0.8 million loan under the Main Street Expanded Loan Facility, originated on December 11, 2020. For the first 12 months, interest is not payable and accrued to the principal balance, thereafter, monthly interest payments are required. The outstanding balance will amortize at a rate of 15% on both December 2023 and December 2024, with the remaining balance due December 2025. The loan bears a variable interest rate equal to one-month LIBOR plus a spread of 3.00%, or 4.79% as of June 30, 2022. This loan may be voluntarily prepaid at any time and from time to time, without premium or penalty, other than customary “breakage costs” and fees for LIBOR-based loans.

Our DuVine subsidiary has a EUR 0.1 million State Assistance Loan related to the financial consequences of the COVID-19 pandemic, for the purpose of employment preservation. This loan matures August 2025, with monthly payments, and bears an annual interest rate of 0.53%.

In August 2020, we issued and sold 85,000 shares of Series A Redeemable Convertible Preferred Stock, par value of $0.0001, (“Preferred Stock”) for $1,000 per share for gross proceeds of $85.0 million. As of June 30, 2022, 62,000 shares of Preferred Stock were outstanding. The Preferred Stock has senior and preferential ranking to our common stock. The Preferred Stock is entitled to cumulative dividends of 6.00% per annum, and for the first two years, the dividends will be paid-in-kind. After the second anniversary of the issuance date, the dividends may be paid-in-kind or be paid in cash at our option. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of our common stock equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $9.50. At any time after the third anniversary of the issuance, we may, at our option, convert all, but not less than all, of the Preferred Stock into common stock if the closing price of shares of common stock is at least 150% of the conversion price for 20 out of 30 consecutive trading days. The number of shares of common stock received in such conversion shall be equal to the quotient obtained by dividing the then-current accrued value by the conversion price. At the six-year anniversary of the closing date, each investor has the right to request that we repurchase their Preferred Stock, and any Preferred Stock not requested to be repurchased shall be converted into our common shares equal to the quotient obtained by dividing the then-current accrued value by the conversion price. During the six months ended June 30, 2022, 18,000 shares of Preferred Stock and related accumulated dividends were converted by the holder into 2,109,561 shares of our common stock. As of June 30, 2022, the outstanding Preferred Stock and accumulated dividends could be converted, at the option of the holders, into approximately 7.3 million shares of our common stock.

We generally rely on a combination of cash flows provided by operations and the incurrence of additional debt to fund obligations. A vast majority of guest ticket receipts are collected in advance of the applicable expedition date. These advance passenger receipts remain a current liability until the expedition date, and the cash generated from these advance receipts is used interchangeably with cash on hand from other cash from operations. The cash received as advanced receipts can be used to fund operating expenses for the applicable future expeditions or otherwise, pay down ~~credit facilities,~~debt, make long-term investments or any other use of cash. Traditionally we run a working capital deficit due primarily to a large balance of unearned passenger ~~revenues~~revenues. As of June 30, 2022, we had a working capital deficit of $123.5 million, and as of ~~September 30,~~December 31, 2021, we had a working capital deficit of ~~$39.5~~$79.1 million. As of December 31, 2020 we had positive working capital of $73.4 million as a result of lower unearned passenger revenues while we were not operating and higher cash balances driven by the debt borrowings and a preferred share offering during the year. As of September 30, 2021 and December 31, 2020, we had $155.6 million and $187.5 million, respectively, in cash and cash equivalents, excluding restricted cash.

Our Board of Directors approved a stock and warrant repurchase plan (“Repurchase Plan”) in November 2015 and increased the repurchase plan to $35.0 million in November 2016. The Repurchase Plan authorizes us to purchase from time to time our outstanding common stock and our previously outstanding warrants. Any shares and warrants purchased will be retired. The Repurchase Plan has no time deadline and will continue until otherwise modified or terminated at the sole discretion of our Board of Directors. These repurchases exclude shares repurchased to settle statutory employee tax withholding related to the exercise of stock options and vesting of stock awards. During March 2020, the Repurchase Plan was suspended due to the uncertain impact of the COVID-19 pandemic and our borrowings through the Main Street Expanded Loan Facility program places restrictions on stock repurchases. We have cumulatively repurchased 875,218 shares of common stock for $8.3 million and 6,011,926 warrants for $14.7 million since plan inception. All repurchases were made using cash resources. The balance for the Repurchase Plan was $12.0 million as of September 30, 2021.

The additional borrowings under the Second Export Credit Agreement and amendments of the First Export Credit Agreement created material changes in our future obligations from those reported in our 2020 Annual Report. The changed or amended obligations as of September 30, 2021 are as follows:

For a detailed discussion of the Critical Accounting Policies, please see our ~~2020~~2021 Annual Report.

There have been no material changes in our exposure to market risks from the information set forth in the “Quantitative and Qualitative Disclosures About Market Risk” sections contained in our ~~2020~~2021 Annual Report.

We are exposed to a market risk for interest rates related to our variable rate debt instruments. We assess our market risks based on changes in interest rates utilizing a sensitivity analysis that measures the potential impact on earnings and cash flows based on a hypothetical 100 basis point change in interest rates. For additional information regarding our long-term borrowings see Note 5 to our Condensed Consolidated Financial Statements included herein. As of September 30, 2021, we had interest rate cap agreements to hedge a portion of our exposure to interest rate movements of our variable rate debt and to manage our interest expense. The notional amount of outstanding debt associated with interest rate cap agreements as of September 30, 2021 was $100.0 million. Based on our ~~September~~June 30, ~~2021~~2022 outstanding variable rate debt balance, a hypothetical 100 basis point increase in LIBOR interest rates related to our variable interest rate debt instruments would impact our annual interest expense by approximately ~~$4.3~~$2.2 million.

~~Our~~Based on an evaluation under the supervision and with the participation of the Company’s management, ~~is responsible for establishing~~the Company’s principal executive officer and ~~maintaining adequate internal control over~~principal financial ~~reporting,~~officer have concluded that the Company’s disclosure controls and procedures as ~~such term is~~ defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act ~~Rule 13a-15(f). Our internal control over financial reporting is a process designed~~of 1934, as amended (the “Exchange Act”) were effective as of June 30, 2022 to provide reasonable assurance ~~regarding~~that information required to be disclosed by the ~~reliability of financial reporting~~Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the ~~preparation of financial statements for external purposes~~time periods specified in ~~accordance with GAAP. Our internal control over financial reporting includes those policies~~the SEC rules and ~~procedures that: (1) pertain~~forms and (ii) accumulated and communicated to the ~~maintenance of records that in reasonable detail accurately~~Company’s management, including its principal executive officer and ~~fairly reflect our transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded~~principal financial officer, as ~~necessary~~appropriate to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made only in accordance with authorizations of our management and our directors; and (3) provide reasonable assuranceallow timely decisions regarding ~~prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.~~

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting, as of September 30, 2021, using the criteria described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the evaluation under the updated internal control framework in Internal Control-Integrated Framework (2013), management concluded that internal control over financial reporting was effective as of September 30, 2021.

Management had previously established a comprehensive set of controls and procedures over financial reporting. However, in several instances during the year ended December 31, 2020 we noted a lack of complete compliance with these controls and procedures, specifically related to the required documentation of certain review procedures performed. Management has taken additional steps to ensure consistent compliance with those controls and procedures, as well as to ensure appropriate documentation of reviews that have taken place. Measures we have taken to remediate the prior material weakness at December 31, 2020 include:

We are committed to maintaining a strong internal control environment, and we believe the measures described above have strengthened our internal control over financial reporting and remediated the material weakness we have identified.disclosure.

~~Except as described above under Remediation Plan, there~~There was no change in our internal control over financial reporting that occurred during the quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

The Company is involved in various claims, legal actions and regulatory proceedings arising from time to time in the ordinary course of business. We have protection and indemnity insurance that would be expected to cover any damages.

We operate in a rapidly changing environment that involves a number of risks that could materially affect our business, financial condition or future results, some of which are beyond our control. The risks and uncertainties that we believe are most important for you to consider are discussed under the heading “Risk Factors” in the ~~2020~~2021 Annual Report.

There were no unregistered sales of equity securities during the quarter ended ~~September~~June 30, ~~2021.~~2022.

6,011,926 warrants for $14.7 million, since plan inception. All repurchases were made using cash resources. The balance for the Repurchase Plan was $12.0 million as of ~~September~~June 30, ~~2021.~~ 2022. The Repurchase Plan is suspended due to restrictions related to the Main Street Expanded Loan Facility program.

The following table represents information with respect to shares of common stock withheld from vesting's of stock-based compensation awards for employee income tax withholding and option exercises for the periods indicated:

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on ~~November~~August 2, ~~2021.~~2022.

	●	Natural Habitat ~~offers over~~ ~~100~~ ~~different expedition~~specializes in conservation-oriented adventures, providing life-enhancing forays into the natural world that feature wild habitats and the animals and people who live there. Natural Habitat’s travel adventures provide unparalleled access to the planet's most extraordinary wildlife, landscapes and cultures. Natural Habitat’s unique itineraries ~~in more than~~ 45 ~~countries spanning all~~ ~~seven~~ ~~continents. The expeditions focus on small groups led by award-winning naturalists to achieve close-up wildlife and nature experiences. Examples of expeditions offered~~ include ~~safaris in Botswana, grizzly bear adventures in Alaska, polar bear tours in Canada and small-group Galápagos tours. Many of the expeditions feature~~ access to private wildlife reserves, remote corners of national parks and distinctive, secluded and remote lodges and camps ~~for the~~situated where wildlife viewing is best, ~~wildlife viewing.~~such as polar bear tours in Churchill, Canada, Alaskan grizzly bear adventures, small-group Galápagos Islands tours and African safaris. Natural Habitat has partnered with World Wildlife Fund (“WWF”) to offer conservation travel, which is sustainable travel that contributes to the protection of nature and wildlife.

	●	DuVine ~~offers~~specializes in luxury cycling and adventure tours around the world, providing immersive cultural and culinary experiences through thoughtfully designed itineraries led by expert local guides. Offerings primarily include tours throughout Europe, the United States and South America. Examples of ~~DuVine's~~DuVine’s tours include cycling and culinary tours throughout the Bordeaux and Burgundy wine making regions, Tuscan truffle, porcini and chestnut harvest regions, Napa and Sonoma wine making regions and lakes and volcanos throughout Patagonia. ~~DuVine's~~DuVine’s trips include top-quality gear and support and are tailored to riders of all abilities with an emphasis on exceptional food and wine experiences, along with boutique accommodations.

	●	Off the Beaten Path ~~offers~~provides active small-group and private custom journeys around the world with a long-standing focus on offering unique adventures and experiences throughout ~~the~~ United States (“U.S.”) National Parks. In addition to other U.S.-based adventures such as ranch vacations and fly-fishing expeditions, Off the Beaten ~~Path's small group~~Path’s small-group product offerings include international expeditions across Europe, Africa, Australia, Central and South America and the South ~~Pacific. Examples of international expeditions include~~Pacific, such as hiking through the Dolomites, ~~enjoying a~~ family ~~adventure~~adventures in Patagonia’s Lake District and experiencing the culture ~~architecture and village life~~ of Morocco. All Off the Beaten Path expeditions are defined by a focus on outdoor activity ~~including wildlife viewing, hiking, rafting, snorkeling, kayaking and snowshoeing, and comprehensive pre-trip materials paired with~~led by experienced, friendly guides.

	*Contract Liabilities*			*Contract Liabilities*
(In thousands)					(unaudited)
Balance as of January 1, 2021	$	73,267
Balance as of December 31, 2021				$	147,783
Recognized in tour revenues during the period		(77,816	)		(157,900	)
Additional contract liabilities in period		125,525			191,989
Balance as of September 30, 2021	$	120,976
Balance as of June 30, 2022				$	181,871

	*As of September 30, 2021*		*As of December 31, 2020*		*As of June 30, 2022*		*As of December 31, 2021*
(In thousands)	(unaudited)				(unaudited)
Credit card processor reserves					$	21,285	$	10,536
Federal Maritime Commission escrow	$	17,208	$	13,856		25,918		9,814
Credit card processor reserves		11,021		1,945
Certificates of deposit and other restricted securities		1,245		1,183		1,628		1,590
Total restricted cash	$	29,474	$	16,984	$	48,831	$	21,940

	*As of September 30, 2021*		*As of December 31, 2020*
(In thousands)	(unaudited)
Prepaid tour expenses	$	12,145	$	5,630
Prepaid marketing, commissions and other expenses		3,874		3,504
Prepaid client insurance		3,604		2,283
Prepaid air expense		3,161		3,817
Prepaid port agent fees		2,946		530
Prepaid corporate insurance		1,149		1,105
Prepaid income taxes		199		145
Total prepaid expenses	$	27,078	$	17,014

	*As of September 30, 2021*		*As of December 31, 2020*
	(unaudited)
(In thousands)
CERTS Grant	$	16,677	$	0
Accrued other expense		10,150		5,645
Accounts payable		8,778		5,285
Bonus compensation liability		4,193		2,963
Employee liability		4,115		3,495
Refunds and commissions payable		2,209		1,803
Travel certificate liability		870		870
Royalty payable		818		0
Accrued travel insurance expense		505		270
Income tax liabilities		2		2
Foreign currency forward contract liability		0		2,008
Total accounts payable and accrued expenses	$	48,317	$	22,341

	*Common Stock*					*Additional Paid-In*			*Retained*			*Accumulated Other Comprehensive*			*Total Stockholders'*
	*Shares*			*Amount*		*Capital*			*Earnings*			*Loss*			*Equity*
Balance as of June 30, 2020		49,822,955		$	5	$	47,394		$	45,403		$	(8,824	)	$	83,978
Stock-based compensation		-			0		310			0			0			310
Issuance of stock for equity compensation plans, net		52,231			0		(42	)		0			0			(42	)
Other comprehensive income, net		-			0		0			0			1,745			1,745
Redeemable noncontrolling interest		-			0		0			1,874			0			1,874
Series A preferred shares dividend					0		0			(425	)		0			(425	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-			0		0			(27,379	)		0			(27,379	)
Balance as of September 30, 2020		49,875,186		$	5	$	47,662		$	19,473		$	(7,079	)	$	60,061

	*Common Stock*					*Additional Paid-In*			*Retained*			*Accumulated Other Comprehensive*			*Total Stockholders'*
	*Shares*			*Amount*		*Capital*			*Earnings*			*Loss*			*Equity*
Balance as of January 1, 2020		49,717,522		$	5	$	46,271		$	81,655			(4,681	)	$	123,250
Stock-based compensation		-			0		1,911			0			0			1,911
Issuance of stock for equity compensation plans, net		166,181			0		(393	)		0			0			(393	)
Repurchase of shares and warrants		(8,517	)		0		(127	)		0			0			(127	)
Other comprehensive loss, net		-			0		0			0			(2,398	)		(2,398	)
Redeemable noncontrolling interest		-			0		0			7,216			0			7,216
Series A preferred shares dividend					0		0			(425	)		0			(425	)
Net loss attributable to Lindblad Expeditions Holdings, Inc.		-			0		0			(68,973	)		0			(68,973	)
Balance as of September 30, 2020		49,875,186		$	5	$	47,662		$	19,473		$	(7,079	)	$	60,061

	*Loan Receivable*
(In thousands)	(unaudited)
Balance as of December 31, 2021	$	3,964
Accrued interest		72
Amortization of deferred costs		(19	)
Balance as of June 30, 2022	$	4,017

																			*As of June 30, 2022*									*As of December 31, 2021*
	As of September 30, 2021									As of December 31, 2020										(unaudited)
(In thousands)	*Principal*			*Deferred Financing Costs, net*			*Balance*			*Principal*			*Deferred Financing Costs, net*			*Balance*			*Principal*			*Deferred Financing Costs, net*			*Balance*			*Principal*			*Deferred Financing Costs, net*			*Balance*
Credit Facility	$	283,490		$	(9,721	)	$	273,769		$	280,993		$	(9,492	)	$	271,501
1st Senior Secured Credit Agreement		107,695			(2,155	)		105,540			107,695			(1,784	)		105,911
2nd Senior Secured Credit Agreement		122,840			(2,540	)		120,300			61,120			(2,261	)		58,859
Revolving Facility		45,000			(227	)		44,773			45,000			(341	)		44,659
6.75% Notes																			$	360,000			(9,989	)	$	350,011		$	0		$	0		$	0
First Export Credit Agreement																				101,244			(1,960	)		99,284			107,695			(2,090	)		105,605
Second Export Credit Agreement																				115,163			(2,340	)		112,823			120,281			(2,473	)		117,808
Note payable		1,684			0			1,684			1,684			0			1,684			842			0			842			842			0			842
Other		1,051			0			1,051			0			0			0			993			0			993			1,034			0			1,034
Credit Facility																				0			0			0			284,170			(9,050	)		275,120
Revolving Facility																				0			0			0			44,500			(190	)		44,310
Total long-term debt		561,760			(14,643	)		547,117			496,492			(13,878	)		482,614			578,242			(14,289	)		563,953			558,522			(13,803	)		544,719
Less current portion		(20,260	)		0			(20,260	)		(11,255	)		0			(11,255	)		(24,081	)		0			(24,081	)		(26,061	)		0			(26,061	)
Total long-term debt, non-current	$	541,500		$	(14,643	)	$	526,857		$	485,237		$	(13,878	)	$	471,359		$	554,161		$	(14,289	)	$	539,872		$	532,461		$	(13,803	)	$	518,658

(In thousands)	*Absolute Notional Value*		*Absolute Notional Value*
Interest rate caps	$	100,000	$	100,000
Foreign exchange contracts		11,191		13,872

	(a)	Recorded in ~~accounts payable and accrued expenses.~~other current assets.
	(b)	Recorded in prepaid expenses and other current assets.

	(a)	For the three ~~and~~months ended ~~nine~~June 30, 2022 recognized as income in interest expense, net. For the six months ended ~~September~~June 30, 2022, $0.3 million was recognized as income in interest expense, net and $0.6 million was reclassified from other comprehensive income (loss) to interest expense, net. For the three and six months ended June 30, 2021, $0.9 million and $1.0 million, respectively, was recognized as a loss on foreign currency in the condensed consolidated statements of income, and $2.4 million and $2.0 million losses, respectively, were recognized, net of tax, as a component of other comprehensive income (loss) within stockholders’ equity.
	(b)	For the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, $~~5.3~~0.1 million was recognized as a loss on foreign currency in the condensed consolidated statements of income, and a ~~$1.7~~$0.0 million and a $0.4 million gain, ~~and a $7.6 million loss,~~ respectively, was recognized, ~~net of tax, as a component of other comprehensive income (loss) within stockholders’ equity.~~

	~~(b)~~	~~Recognized,~~ net of tax, as a component of other comprehensive income (loss) within stockholders’ equity.
	(c)	Gains (losses) related to derivative instruments are expected to be largely offset by (losses) gains on the underlying exposures being ~~hedged. During the~~ ~~three~~hedged and~~nine~~ ~~months ended~~ ~~September 30, 2021,~~ ~~a gain of $0.3 million and $0.2 million, respectively, were recognized in gain (loss) on foreign currency. During the~~ ~~three~~ ~~and~~ ~~nine~~ ~~months ended~~ ~~September 30, 2020,~~ ~~a gain of $1.0 million and a loss of $1.0 million was~~ recognized in gain (loss) on foreign currency.

For the years ended December 31,	*Amount*
(In thousands)
2021 (three months)	$	622
2022		6,247
2023		2,790
Total	$	9,659

	For the three months ended September 30,										For the nine months ended September 30,										*For the three months ended June 30,*									*For the six months ended June 30,*
	*2021*		*2020*		*Change*			%			*2021*		*2020*		*Change*			%			*2022*		*2021*		*Change*		%			*2022*		*2021*		*Change*		%
(In thousands)	(unaudited)										(unaudited)										(unaudited)									(unaudited)
Depreciation and amortization:
Lindblad	$	8,928	$	7,888	$	1,040			13	%	$	24,618	$	22,075	$	2,543			12	%	$	10,257	$	7,823	$	2,434		31	%	$	20,998	$	15,690	$	5,308		34	%
Land Experiences		395		597		(202	)		(34	)%		1,167		1,653		(486	)		(29%	)		919		390		529		136	%		1,356		772		584		76	%
Total depreciation and amortization	$	9,323	$	8,485	$	838			10	%	$	25,785	$	23,728	$	2,057			9	%	$	11,176	$	8,213	$	2,963		36	%	$	22,354	$	16,462	$	5,892		36	%

	●	suspended operations, cancelling or rescheduling of voyages and other potential disruptions to our business and operations related to the ~~novel coronavirus COVID-19;~~COVID-19 virus and/or the Russia-Ukraine conflict;

	●	the impacts of the ~~novel coronavirus~~ COVID-19 virus and/or the Russia-Ukraine conflict on our financial condition, liquidity, results of operations, cash flows, employees, plans and ~~growth;~~growth, fuel prices, changes in fuels consumed and availability of fuel supply in the geographies in which we operate or in general;

	●	adverse worldwide economic, geopolitical or other conditions could reduce the ~~impacts of the novel coronavirus COVID-19 on future travel and the cruise and airline industries in general;~~demand for expedition travel;
		��
	●	adverse publicity regarding the cruise industry in general;

	●	unscheduled disruptions in our business due to travel restrictions, weather events, mechanical failures, pandemics or other events;

	●	changes adversely affecting the business in which we are engaged;

	●	management of our growth and our ability to execute on our planned growth, including our ability to successfully integrate acquisitions;

	●	our business strategy and plans;

	●	our ability to maintain our relationship with National Geographic;

	●	compliance with ~~new and existing laws and regulations, including environmental regulations and travel advisories and restrictions;~~

	●	~~compliance with~~ the financial and/or operating covenants in our debt arrangements;

	●	~~adverse publicity regarding~~ the ~~cruise industry in general;~~ impact of severe or unusual weather conditions, including climate change, on our business;

	●	loss of business due to competition;

	●	the result of future financing efforts;

	●	~~delays~~compliance with new and ~~costs overruns~~existing laws and regulations, including environmental regulations and travel advisories and restrictions;

	●	the loss of key employees, our inability to recruit or retain qualified shoreside and shipboard employees and increased labor costs;

	●	the inability to meet or achieve our sustainability related goals, aspirations, initiatives, and our public statements and disclosures regarding them;

	*As of September 30, 2021*				*As of December 31, 2020*				*As of June 30, 2022*				*As of December 31, 2021*
	(unaudited)								(unaudited)
(In thousands)	*Fair Value, Asset Derivatives*		*Fair Value, Liability Derivatives*		*Fair Value, Asset Derivatives*		*Fair Value, Liability Derivatives*		*Fair Value, Asset Derivatives*		*Fair Value, Liability Derivatives*		*Fair Value, Asset Derivatives*		*Fair Value, Liability Derivatives*
Derivative instruments designated as cash flow hedging instruments:
Foreign exchange forward (a)	$	0	$	0	$	0	$	2,008
Interest rate cap ^(a)									$	0	$	0	$	9	$	0
Total	$	0	$	0	$	0	$	2,008	$	0	$	0	$	9	$	0
Derivative instruments not designated as cash flow hedging instruments:
Interest rate cap ^(a)									$	346	$	0	$	0	$	0
Foreign exchange forward (b)	$	765	$	0	$	953	$	0		119		0		664		0
Total	$	765	$	0	$	953	$	0	$	465	$	0	$	664	$	0

	●	our common stock ranks junior to our Series A Preferred Stock with respect to dividends and amounts payable in the ~~construction~~event of our liquidation, dissolution or winding up our affairs; and ~~delivery of newly constructed vessels;~~

	●	those risks discussed herein and in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, as filed with the SEC on ~~March 12, 2021~~February 28, 2022 (the ~~“2020~~“2021 Annual Report”).

	●	a description of certain line items and operational and financial metrics we utilize to assist us in managing our business;

	●	results and a comparable discussion of our consolidated and segment results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 and ~~2020;~~2021;


	●	a discussion of our liquidity and capital resources, including future capital and contractual commitments and potential funding sources; and

	●	a review of our critical accounting policies.

	●	Guest ticket revenues recognized from the sale of guest tickets; and

	●	Other tour revenues from the sale of pre- or post-expedition excursions, hotel accommodations, air transportation to and from the ships and excursions, goods and services rendered onboard that are not included in guest ticket prices, trip insurance, and cancellation fees.

	●	Direct costs associated with revenues, including cost of pre- or post-expedition excursions, hotel accommodations, and land-based expeditions, air and other transportation expenses, and cost of goods and services rendered onboard;

	●	Payroll costs and related expenses for shipboard and expedition personnel;

	●	Food costs for guests and crew, including complimentary food and beverage amenities for guests;

	●	Fuel costs and related costs of delivery, storage and safe disposal of waste; and

	For the three months ended September 30,										For the nine months ended September 30,
(In thousands)	2021			2020			Change			%	2021			2020			Change				%
Tour revenues	$	64,507		$	1,019		$	63,488	NM		$	81,555		$	81,991		$	(436	)	(1	)%

Cost of tours		45,600			8,075			37,525	465	%		73,270			62,988			10,282		16	%
General and administrative		17,023			9,145			7,878	86	%		46,123			36,170			9,953		28	%
Selling and marketing		10,213			2,128			8,085	380	%		17,680			18,413			(733	)	(4	)%
Depreciation and amortization		9,323			8,485			838	10	%		25,785			23,728			2,057		9	%
Operating loss	$	(17,652	)	$	(26,814	)	$	9,162	34	%	$	(81,303	)	$	(59,308	)	$	(21,995	)	(37	)%
Net loss	$	(23,299	)	$	(27,535	)	$	4,236	15	%	$	(92,894	)	$	(69,929	)	$	(22,965	)	(33	)%
Undistributed loss per share available to stockholders:
Basic	$	(0.50	)	$	(0.56	)	$	0.06			$	(1.87	)	$	(1.40	)	$	(0.47	)
Diluted	$	(0.50	)	$	(0.56	)	$	0.06			$	(1.87	)	$	(1.40	)	$	(0.47	)

	For the three months ended June 30,											For the six months ended June 30,
(In thousands)	2022			2021			Change		%			2022			2021			Change			%
Tour revenues	$	90,910		$	15,266		$	75,644		NM		$	158,756		$	17,047		$	141,709			NM

Cost of tours		62,499			19,391			43,108		NM			120,447			27,670			92,777			NM
General and administrative		23,710			15,288			8,422		55	%		44,347			29,100			15,247			52	%
Selling and marketing		12,839			4,962			7,877		NM			25,168			7,467			17,701			NM
Depreciation and amortization		11,176			8,213			2,963		36	%		22,354			16,462			5,892			36	%
Operating loss	$	(19,314	)	$	(32,588	)	$	13,274		41	%	$	(53,560	)	$	(63,652	)	$	10,092			16	%
Net loss	$	(28,558	)	$	(35,735	)	$	7,177		20	%	$	(70,706	)	$	(69,595	)	$	(1,111	)		(2	)%
Undistributed loss per share available to stockholders:
Basic	$	(0.59	)	$	(0.71	)	$	0.12				$	(1.43	)	$	(1.38	)	$	(0.05	)
Diluted	$	(0.59	)	$	(0.71	)	$	0.12				$	(1.43	)	$	(1.38	)	$	(0.05	)

	●	A ~~$1.4~~$3.7 million ~~loss~~increase in ~~foreign currency translation in 2021, compared~~interest expense, net to ~~a gain of $1.0~~$9.4 million in ~~2020 which was~~2022, primarily due ~~primarily~~ to ~~$2.5 million loss on the maturity of a foreign currency hedge~~additional drawdowns throughout 2021 under our export credit agreements related to the ~~final payment for~~delivery of the National Geographic Resolution ~~upon its delivery~~, as well as increased principal on our notes as a result of the debt refinancing in ~~September 2021.~~ February 2022 and higher rates across our debt facilities.

	●	A ~~$1.5~~net loss of $0.8 million ~~increase in interest expense, net to $6.1 million in 2021,~~ primarily due to ~~increased borrowings under our term loan facility as part of the Main Street Lending Program, and the additional drawdowns under our export credit agreements related to the~~ ~~National Geographic Resolution~~~~, as well as higher rates~~a loss on ~~our debt facilities.~~

	●	~~Recognition of $4.4 million in other income related to expenses covered under the CERTS grant received in September 2021.~~foreign currency translation.

	●	A ~~$1.2~~$6.8 million ~~loss~~increase in ~~foreign currency translation~~interest expense, net to $18.1 million in ~~2021, compared to a $6.3 million loss in foreign currency translation in 2020~~2022, primarily due to ~~lower losses on the maturity of foreign currency hedges~~additional drawdowns throughout 2021 under our export credit agreements related to ~~installment payments for~~the delivery of the National Geographic Resolution, as well as increased principal on our notes as a result of the debt refinancing in ~~2021 as compared with 2020.~~February 2022 and higher rates across our debt facilities.

	●	A ~~$5.7~~net loss of $0.1 million ~~increase in interest expense, net to $17.4 million in 2021,~~ primarily due to ~~increased borrowings under~~the write-off of $9.0 million of deferred financing costs and $1.9 million of fees and other expenses related to the repayment of our prior credit agreement, including the term ~~loan~~ facility, ~~as part of the~~ Main Street ~~Lending Program, the higher rates~~Loan and revolving credit facility, and a $0.6 million loss on ~~our debt facilities and the additional drawdowns under our export credit agreements related to our new builds, the~~ ~~National Geographic Endurance~~ ~~and the~~ ~~National Geographic Resolution~~.

	●	~~Recognition~~foreign currency translation, mostly offset by recognition of ~~$4.4~~$11.6 million in other income related to expenses covered under the CERTS ~~grant received in September 2021.~~
		grant.

Calculation of Gross Yield per Available Guest Night and Net Yield per Available Guest Night	For the three months ended September 30,						For the nine months ended September 30,
(In thousands, except for Available Guest Nights, Gross and Net Yield per Available Guest Night)	2021			2020			2021			2020
Guest ticket revenues	$	32,325		$	-		$	38,087		$	60,351
Other tour revenue		775			16			2,177			9,182
Tour Revenues		33,100			16			40,264			69,533
Less: Commissions		(2,705	)		(818	)		(3,248	)		(8,080	)
Less: Other tour expenses		(1,545	)		(308	)		(2,611	)		(7,021	)
Net Yield	$	28,850		$	(1,110	)	$	34,405		$	54,432
Available Guest Nights		35,251			-			41,474			51,624
Gross Yield per Available Guest Night	$	939			NM		$	971		$	1,347
Net Yield per Available Guest Night		818			NM			830			1,054

Calculation of Gross Cruise Cost and Net Cruise Cost	For the three months ended September 30,						For the nine months ended September 30,
(In thousands, except for Available Guest Nights, Gross and Net Cruise Cost per Avail. Guest Night)	2021			2020			2021			2020
Cost of tours	$	25,842		$	7,534		$	48,282		$	55,237
Plus: Selling and marketing		8,382			1,678			13,659			16,862
Plus: General and administrative		12,230			7,751			34,322			29,646
Gross Cruise Cost		46,454			16,963			96,263			101,745
Less: Commissions		(2,705	)		(818	)		(3,248	)		(8,080	)
Less: Other tour expenses		(1,545	)		(308	)		(2,611	)		(7,021	)
Net Cruise Cost		42,204			15,837			90,404			86,644
Less: Fuel Expense		(2,357	)		(1,026	)		(3,880	)		(4,350	)
Net Cruise Cost Excluding Fuel		39,847			14,811			86,524			82,294
Non-GAAP Adjustments:
Stock-based compensation		(1,406	)		(310	)		(4,012	)		(1,911	)
National Geographic fee amortization		-			-			-			(727	)
Other		(328	)		(549	)		(1,007	)		(573	)
Adjusted Net Cruise Cost Excluding Fuel	$	38,113		$	13,952		$	81,505		$	79,083
Adjusted Net Cruise Cost	$	40,470		$	14,978		$	85,385		$	83,433
Available Guest Nights		35,251			-			41,474			51,624
Gross Cruise Cost per Available Guest Night	$	1,318			NM		$	2,321		$	1,971
Net Cruise Cost per Available Guest Night		1,197			NM			2,180			1,678
Net Cruise Cost Excluding Fuel per Available Guest Night		1,130			NM			2,086			1,594
Adjusted Net Cruise Cost Excluding Fuel per Available Guest Night		1,081			NM			1,965			1,532
Adjusted Net Cruise Cost per Available Guest Night		1,148			NM			2,059			1,616

Consolidated	For the three months ended September 30,						For the nine months ended September 30,
(In thousands)	2021			2020			2021			2020
Net loss	$	(23,299	)	$	(27,535	)	$	(92,894	)	$	(69,929	)
Interest expense, net		6,063			4,529			17,436			11,763
Income tax expense (benefit)		2,507			(2,893	)		(2,648	)		(7,664	)
Depreciation and amortization		9,323			8,485			25,785			23,728
Loss (gain) on foreign currency		1,434			(989	)		1,165			6,334
Other (income) expense		(4,357	)		74			(4,362	)		188
Stock-based compensation		1,406			310			4,146			1,911
National Geographic fee amortization		-			-			-			727
Other		328			549			1,007			573
Adjusted EBITDA	$	(6,595	)	$	(17,470	)	$	(50,365	)	$	(32,369	)

Lindblad Segment	For the three months ended September 30,						For the nine months ended September 30,						For the three months ended June 30,						For the six months ended June 30,
(In thousands)	2021			2020			2021			2020			2022			2021			2022			2021
Operating loss	$	(22,282	)	$	(24,835	)	$	(80,617	)	$	(54,287	)	$	(19,670	)	$	(31,038	)	$	(53,239	)	$	(58,335	)
Depreciation and amortization		8,928			7,888			24,618			22,075			10,257			7,823			20,998			15,690
Stock-based compensation		1,406			310			4,012			1,911			1,823			1,129			3,651			2,606
National Geographic fee amortization		-			-			-			727
Other		352			549			605			573			127			254			142			254
Adjusted EBITDA	$	(11,596	)	$	(16,088	)	$	(51,382	)	$	(29,001	)	$	(7,463	)	$	(21,832	)	$	(28,448	)	$	(39,785	)

Land Experiences Segment	For the three months ended June 30,						For the six months ended June 30,
(In thousands)	2022			2021			2022			2021
Operating income (loss)	$	356		$	(1,550	)	$	(321	)	$	(5,317	)
Depreciation and amortization		919			390			1,356			772
Stock-based compensation		-			-			-			134
Other		(4	)		39			-			426
Adjusted EBITDA	$	1,271		$	(1,121	)	$	1,035		$	(3,985	)

Calculation of Gross and Net Yield per Available Guest Night	For the three months ended June 30,						For the six months ended June 30,
(In thousands, except for Available Guest Nights, Gross and Net Yield per Available Guest Night)	2022			2021			2022			2021
Guest ticket revenues	$	55,560		$	5,762		$	101,062		$	5,762
Other tour revenue		8,487			918			13,259			1,402
Tour Revenues		64,047			6,680			114,321			7,164
Less: Commissions		(4,248	)		(515	)		(8,653	)		(543	)
Less: Other tour expenses		(5,006	)		(432	)		(14,995	)		(1,066	)
Net Yield	$	54,793		$	5,733		$	90,673		$	5,555
Available Guest Nights		55,413			6,270			103,959			6,270
Gross Yield per Available Guest Night	$	1,156		$	1,065		$	1,100		$	1,143
Net Yield per Available Guest Night		989			914			872			886

Calculation of Gross and Net Cruise Cost	For the three months ended June 30,						For the six months ended June 30,
(In thousands, except for Available Guest Nights, Gross and Net Cruise Cost per Avail. Guest Night)	2022			2021			2022			2021
Cost of tours	$	46,384		$	14,835		$	93,955		$	22,440
Plus: Selling and marketing		10,708			3,581			20,991			5,277
Plus: General and administrative		16,368			11,479			31,616			22,092
Gross Cruise Cost		73,460			29,895			146,562			49,809
Less: Commissions		(4,248	)		(515	)		(8,653	)		(543	)
Less: Other tour expenses		(5,006	)		(432	)		(14,995	)		(1,066	)
Net Cruise Cost		64,206			28,948			122,914			48,200
Less: Fuel Expense		(6,561	)		(1,011	)		(12,486	)		(1,523	)
Net Cruise Cost Excluding Fuel		57,645			27,937			110,428			46,677
Non-GAAP Adjustments:
Stock-based compensation		(1,823	)		(1,129	)		(3,651	)		(2,606	)
Other		(123	)		(293	)		(142	)		(254	)
Adjusted Net Cruise Cost Excluding Fuel	$	55,699		$	26,515		$	106,635		$	43,817
Adjusted Net Cruise Cost	$	62,260		$	27,526		$	119,121		$	45,340
Available Guest Nights		55,413			6,270			103,959			6,270
Gross Cruise Cost per Available Guest Night	$	1,326			NM		$	1,410			NM
Net Cruise Cost per Available Guest Night		1,159			NM			1,182			NM
Net Cruise Cost Excluding Fuel per Available Guest Night		1,040			NM			1,062			NM
Adjusted Net Cruise Cost Excluding Fuel per Available Guest Night		1,005			NM			1,026			NM
Adjusted Net Cruise Cost per Available Guest Night		1,124			NM			1,146			NM

	Payments due by period
(In thousands)	Total		Current		1-2 years		3-4 years		Thereafter
Financing Activities:
Export Credit Agreement ^(a)	$	107,695	$	6,450	$	25,802	$	39,320	$	36,123
Second Export Credit Agreement ^(b)		122,840		7,678		20,474		20,474		74,214
Total	$	230,535	$	14,128	$	46,276	$	59,794	$	110,337

	~~(a)~~	~~The June 2021 amendment to the First Export Credit Agreement deferred principal amortization payments through December 31, 2021, as described above.~~
	~~(b)~~	The balance and future obligations reflect the April 2021 and September 2021 additional borrowings of $15.5 million and $46.2 million, respectively, under the Second Export Credit Agreement for contracted installment payment on the ~~National Geographic Resolution~~.

	●	~~Additional ongoing communications and training to employees across the entire organization regarding the importance of adhering to control procedures and maintaining proper documentation.~~

	●	~~Enhanced communications and documentation regarding reviews of journal entries and balance sheet reconciliations in a timely manner.~~

	●	~~Additional layers of examination to ensure appropriate review procedures over journal entries and balance sheet reconciliations have taken place and have been subsequently documented appropriately.~~

	●	Exploring the ability to further leverage our information technology resources and general ledger system to enhance communication and documentation of review over journal entries and balance sheet reconciliations.

Period	Total number of shares purchased		Average price paid per share		Dollar value of shares purchased as part of publicly announced plans or programs		Maximum dollar value of warrants and shares that may be purchased under approved plans or programs
July 1 through July 31, 2021		189	$	12.12	$	-	$	11,974,787
August 1 through August 31, 2021		554		14.69		-		11,974,787
September 1 through September 30, 2021		383		13.75		-		11,974,787
Total		1,126			$	-